SACO Chairman says 2022 results ‘unsatisfactory’; keen on customer feedback about prices, quality

Sameer Alhamidi, Chairman of Saudi Company for Hardware

Saudi Company for Hardware (SACO) reported “unsatisfactory” set of results for 2022, which fell short of management and shareholders’ expectations, Chairman Sameer Alhamidi told Argaam in an interview, citing the post-pandemic challenges faced by the company in the last two years.

The company was impacted by several factors, including the high costs of supply chains and late delivery of goods, which, at times, led to the accumulation of out-of-season goods. SACO was also not ready for e-commerce services at that time; thus, it held market shares in terms of goods and services.

“We are considering the performance of all showrooms, and two showrooms that failed to deliver our plan were shut,” Alhamidi said, noting that most of SACO’s branches demonstrate positive performance.

In Q4 2022, SACO allocated nearly SAR 69 million provisions for 2023. In case there is a need to liquidate a slow-moving inventory, these provisions will help SACO insulate against its impact and will also alleviate impact of shutdowns, the Chairman explained.

More-than-sufficient provisions were taken and could be reversed by the end of the period if the inventory and the showrooms being developed by SACO reflect better performance.

The company focuses mainly on the development and reorganization of its showrooms to improve customer’s experience and allow them to enjoy shopping time by enhancing product showcasing as well as introducing new products and services. SACO will also form partnerships in cooperation with the real estate sector, manufacturers and suppliers to achieve its goals.  

Under the new plan, SACO will open branches to meet the needs of customers across all locations in terms of area, products and services whether these branches are situated within cities, on the outskirts, in industrial spaces or agricultural areas, Alhamidi said, adding this will be based on studies to fulfill client demand.

“We carefully listen to our customers’ remarks and appreciate their feedback on pricing and quality. We promise to offer them the best product mix and highest quality. We will also develop e-sales to provide integrated services at competitive prices,” he affirmed.

SACO has been working on its strategic transformation plan until 2025 for more than two months. Investments will be financed by the company’s resources and its credit ability to secure Shariah-compliant facilities from banks.

The amounts offered by banks are sufficient and even larger than SACO’s needs, the Chairman concluded.

SACO widened 2022 net loss of SAR 142.5 million, from SAR 28.5 million in 2021. The fourth-quarter losses came in at SAR 77.2 million, Argaam earlier reported.