Following the news that ScS has agreed to a £99.4m sale to the Italian upholstery vertical Poltronesofà;

Matt Walton, Senior Data Analyst for Retail, at GlobalData, a leading data and analytics company, offers his view:

“ScS is set to become a greater threat within the UK furniture market after it agreed to be sold to the Italian upholstery specialist Poltronesofà for £99.4m, in the biggest move within the market since Dreams was acquired by Tempur Sealy. The deal represents a significant upgrade of its market capitalisation, with the business being valued at just over £57m the prior day. This deal will benefit the UK business by significantly increasing its scale, with Poltronesofà operating over 300 stores across Europe. The UK will become Poltronesofà’s third largest market in terms of stores (100), trailing only Italy (167) and France (106).

“Increased manufacturing capacity and scale will be one of the main benefits of this deal for the new UK business, with Poltronesofà’s four production sites in Italy. This will help ScS improve its delivery times, as it will be less reliant on Far East deliveries, and improve design perceptions. This ties in well with ScS’ shift in marketing away from price towards focusing on design and creating an emotive appeal. This will be beneficial as achieving a new look is a key purchase motivator for upholstery shoppers, with Poltronesofà designing its own pieces inhouse. ScS’ strong online offer will also be attractive to Poltronesofà, with the online furniture market being more developed in the UK than continental Europe.

“This acquisition does not put DFS’ position atop the upholstery market under threat in the short term, with its market share currently more than double that of ScS. However, this will make DFS’ sister fascia Sofology’s aim to overtake ScS for second place more challenging. Poltronesofà has shown a willingness to invest when entering a new country, with it reporting that it has a market share of over 10% of the French upholstery market within 12 years of entering the country. With its even greater scale now, coupled with a renewed focus on design, the new ScS business is well positioned to continue to gain share in 2024 as market conditions start to recover.”