Britain’s biggest online flooring retailer says it has invested heavily to negate the impact of a change in the way search giant Google ranks websites.

Revenue in the year to end March declined 4.7 per cent to £15.6m for UK Flooring Direct, with the ecommerce firm increasing its marketing spend and investing heavily in a new cloud based operating system.

Coventry based UKFD slipped to a £124k pre-tax loss (2013: profit of £366k) as a result of its increased investment, though a £180k tax credit meant after-tax earnings remained positive.

The business was also strongly cash generative, bringing in a net £576k cash from operations and boosting year-end net funds to £681k (2013: £516k) including net capex spend of £281k.

This included £162k in software and website costs, with founder Jason Ashby telling the Furnishing Report that overall they were happy with the year given the business had to deal with significant changes within the marketplace.

“A well publicised change in the way Google ranks websites had a negative effect on visitors to the website throughout the period,” he said.

“We all knew the change would take place, but not quite as quickly as it did, so the result meant we had to increase marketing spend to maintain market share, achieved with an increase in margin and amidst increased competition.”

He added that the firm had also carried out significant investment in a new cloud based operating system.

He said: “It will offer a unified software system connecting financial, customer, and product data, and will provide a 360 degree view of the customer giving us increase market intelligence. The result will allow us to better service and understand our customers, resulting in increased sales and profitability. Importantly it will leave UK Flooring Direct in a strong position to implement exciting new plans for the future.”