Beauty Bay’s sales plummeted by more than £40m in 2022 as consumers flocked back to bricks-and-mortar shopping.
The online retailer’s turnover dropped by 31% from £134m to £93m during the 12-month period ending 31 March 2022.
Beauty Bay said the decrease was "primarily driven by a return to more normalised levels of customer acquisition and orders post-Covid.
“[It also] followed an exceptional increase in levels of new customer acquisition in the prior year.
“Where customers switched away from traditional high street retail to online retail to purchase beauty products during the Covid lockdown period.”
The Gen Z-focused company’s gross profit also decreased 54% to £12.9m, compared to £28.3m 2021 and £16.3m in 2020.
Its pre-tax loss also totalled £9.3m, while earnings before interest, taxes, depreciation, and amortisation (EBITDA) reported a loss of £7.7m.
However, Beauty Bay’s turnover was up 13% in comparison to its pre-pandemic levels – £82m in the year ending 31 March 2020.
It has also hired more employees, with staff numbers rising from 150 to 183 in 2022.
Cosmetics Business has reached out to Beauty Bay for comment.
The online e-tailer was also rumoured to muling the idea of becoming a public company.
However, in May 2022 it abandoned its IPO plans due to inflation burdening the cosmetics market.
Beauty Bay was founded in 1999 by brothers Arron and David Gabbie.
Navigating the ‘new normal’
Many beauty companies experienced rocky sales in 2022.
The industry continued to readjust post-pandemic while also navigating the ongoing cost of living crisis.
British e-tailer The Hut Group (THG) issued a profit warning in its half-year 2022 results.
Rising interest rates and energy costs led the company to update its full-year guidance for the remainder of the year.
Estée Lauder Companies (ELC) also reported an 11% slump in Q1 2023 sales due to Covid-19 restrictions in China.
Its net earnings also declined to US$489m, down from $692m from the same period last year.
