Operating revenues of Okala doubled in the first six months of this year, and sales rose 140 percent in September. The company spent $4M to build a network of customers.
According to Ideaagency, Okala’s audited financial statements show that the company has earned $4.3M for the first six months of this year. This is doubled than the same period last year.
The company’s operating costs also increased by 2.6 times to $4M. The sales, administrative and public costs of Okala have also increased almost as much as $9M.
Ofogh Kourosh Chain Store Company has issued a statement in Codal to better evaluate the performance of Okala: “The main activity of Okala is with Ofogh Kourosh Chain Stores; Therefore, evaluating the results of Ofogh Kourosh’s online sales on the Okala platform should be analyzed seamlessly with Ofogh Kourosh’s performance in online sales.”
“Internet sales profit rate is higher”
The announcement, referring to the audited financial statements of the six months ending September 21, 2024 Ofogh Kourosh, announced that the total amount of online sales of the Ofogh Kourosh Chain Stores, which is fully on the Okala platform, was $44.8M.
After deducting the costs of online sales and the income from this place, Ofogh Kourosh has made a profit equal to $6M from this place, which is much higher than Ofogh Kourosh’s profit rate in in-person sales.
According to the announcement, according to the Ofogh Kourosh and Okala agreement, the company’s internet sales commission rate has always declined in recent years and has declined to one -third of the start of activity.
Cost of $7.5M for marketing
Part of Okala’s net loss is related to safflower efforts to increase the company’s market share. Given the opportunities available in the market and with the aim of gaining more market share, the company has started environmental and digital marketing activities so that by improving brand awareness, it can maximize existing opportunities.
According to the financial statements released on Codal, Okala has spent $7.5M on advertising and marketing, which has doubled compared to the same period last year. About $3.2M of this figure has been spent on attracting customers and $4.3M for marketing and advertising.
The company has also spent $383,000 on the development of its software, which has been reported in intangible assets.
Another significant cost of OKala in the overhead cost is the cost of sending orders, from $364,000 in the first half of 2023 to $632,000 in the first half of 2024. Due to the free shipping fee, the company did not have any income for sending orders. Of course, for the packaging cost, it had earned $287,000, which did not exist in the same period last year.
Changes in capital spending
Okala has spent on the creation, development and consolidation of the market that is recorded in the headlines of transitional spending. These costs are intended to build a network of suppliers, which include SMS discounts. The company’s transfer costs during the first six months of this year were $1.5M. According to the rules of accounting, some of these costs have been depreciated and affected by profit and loss.
Okala program to get out of losses
In the announcement that we mentioned earlier, it is stated that Okala has made preparations to exit the loss due to the improvements made in the company’s activity and the growth of the operation level.
Last year and this year, the company, focusing on improving the quality of customer service, increasing their loyalty and cost productivity, reduced its cost -to -income ratio by more than 30 % and predicts the trend will continue.
Another important point is that the 5 % increase in Okala sales in September this year compared to last year. The company has predicted that this will provide fixed costs with a decline in the ratio of variable costs of the company.
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