SINGAPORE (Oct 27): Koda started producing furniture under the Commune brand in 2011.

Now, that brand has become a key driver of the company’s growth.

Commune already has about 50 stores across the region, including four in Singapore. Within the next three years, Koda wants to double this number.

The bulk of the new stores will be in China as well as the Philippines and Taiwan.

Koda is challenging a growing consensus that physical retail stores are no longer a potent means of engaging customers and selling products.

Commune stores adopt a host of cutting-edge retail technologies that is making its stores more effective. It uses virtual reality (VR) simulation in conjunction with a 3D floor planner. The software allows potential customers to pick out pieces of furniture from its catalogue and, via VR simulation, see how the chosen items of furniture would look in a room.

For FY2017 ended June 30, Koda reported a 2.5 times jump in earnings to US$4.1 million ($5.6 million) from US$1.6 million, on a 33.3% increase in revenue to US$49.5 million.

Commune also contributed about 15% of the company’s total revenue for the year, and was the key reason its profit margins expanded.

When Koda reported these results in September, it also announced a one-for-one bonus issue. That was its second bonus issue in only three months. The company had announced a two-for-one bonus issue in June.

At the Friday close, shares in Koda, trading cum dividend and bonus, are up 12.5 cents or 7.1% at $1.875 with 595,000 units changing hands.

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