Blackcircles rolls out profit jump 08 | 04 | 2013
SCOTTISH TYRE GIANT Blackcircles.com has seen a 30% compound growth in business in the last 12 months. The results from the Peebles-based company are all the more impressive, in that they coincide with a 13% drop in the total UK tyre market over the same period.
Founded in 2001 by Michael Welch (pictured), who financed the business by stacking shelves in Tesco, Blackcircles saw its turnover increase to £23.2 million, with profits doubling to £600,000 (listen to Mike Welch interview on Radio 5 Live).
The web-based company, which now attracts in excess of 250,000 visitors to its website each month, has benefitted from its tie-up with Tesco, which includes operating Tesco Tyres and offering Clubcard points on purchases.
And Welch acknowledges the most recent growth ensures the company remains on course to achieve a turnover of £100m in five years: that equates to 10% of the tyre business in the UK.
“We want sales of £100m in the next five years," the Liverpudlian said. "There are things we are doing now organically which mean we'll not be too far off that.
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"But there will be things we will need to do to give the business a shot in the arm. The most important part of that is making sure customers know we exist.”
And Blackcircles.com — which has more than 1700 independent garages, franchises and mobile sites that operate as tyre-fitting centres — intends turning to Europe to help accelerate future growth.
“While strengthening our existing partnerships in the UK is a key focus moving ahead," Welch continued, "increasingly we are looking in Europe for partnerships and acquisitions that present a good fit for the business.”
With former Tesco boss Sir Terry Leahy onboard, and holding a 25% share in the company, the future for Blackcircles.com — which claims to be up to 40% cheaper than impromptu tyre purchases from high street chains — continues to look robust, positive and profitable.
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Jim McGill