Covid-19 was a disaster for Belgian chocolate store chain Leonidas: many pralines ended in the bin due to the lockdowns. But “never waste a good crisis”: lessons were learnt, especially online.
Progress erased
The timing of the pandemic outbreak and subsequent lockdowns was abysmal for Leonidas: just before Easter, one of the two main dates on the chocolate calendar. Instead of a sales boom, the chain now had almost zero sales for three months (April, May, June) – even though it was allowed to keep most stores open as it is a food retailer.
As a result, the company’s profits nosedived, Belgian business newspaper De Tijd says quoting CEO Philippe de Selliers. In its financial year 2019-2020, ending in June, the chocolate producer had hoped to double its profits to 15 million euros. All signs were good to actually reach that ambitious target, until Covid-19 struck and all progress was erased – leaving profits level at 7 million euros. One factor were the rising costs: the extra stock for Easter did not find its way to customers, but was instead either given away for free to franchise stores and employees, or even just thrown away. Moreover, costs for the protection of employees in its 1,300 European stores were enormous.
Still, there is a bright side to this crisis: Leonidas has found out it has a huge potential online. E-commerce went up to thirty times the normal level around Easter, and despite its limited potential (about 5 % of total turnover according to the CEO) the company is now certain that online is the way forward. It will therefore launch both home deliveries and a click-and-collect service in the coming weeks.
