Home > Sound > 24Bit Media Players > EXCLUSIVE: Kennedy Group To Bail Out Of Bang & Olufsen

The Kennedy Group are set to bail out of their retail relationship with Bang & Olufsen with sales of all the Danish Companies products set to move to a distributor model.

At one stage the Kennedy Luxury Group operated 10 stand-alone Bang & Olufsen stores in Australia and New Zealand now they are bailing out of all of them as leases become due.

ChannelNews understands that the highly successful Kennedy Group do not see a future for Bang & Olufsen in their portfolio of Luxury goods.

The Danish Sound Company was initially set up in Australia by Melbourne based Andrew Donaldson in 1986. A Company that I owned at the time conducted the first ever PR launches for Bang & Olufsen.

Donaldson initially started selling their products into Grace Bros, Myer and David Jones, but after six months and after working out that pimple faced sales people on the floor of these retailers were struggling to even understand where Denmark was he moved to open a direct sell store in Camberwell and then in Bondi.

The business flourished.

Recently B&O decided to pull out of selling high priced TV’s and ChannelNews understands that there are concerns in Australia as to who will become liable for warranty claims on B&O TV’s in Australia.

The Company is also moving back to premium sound gear after struggling with their bottom end B&O Play range which was recently rebranded Bang & Olufsen.

After struggling for several years Bang & Olufsen recently reported that they had “swung to profit” in its fiscal fourth quarter ending in July 2018 and that they expect to maintain the current momentum by growing in all regions and further improving profitability.

The company said net profit for the three months ended May 31 was 53.2 million Danish kroner ($8.4 million) compared with a loss of DKK75.8 million in the same period a year earlier. The figure was better than the DKK32 million expected by analysts.

Revenue rose to A$129 million up from A$122 million.

The company has spent the past couple of years trying to streamline its traditional business of selling upmarket audio and television equipment while expanding in the lower-end consumer-goods market via its B&O Play brand.

This shift in operating model will result in further reductions of development costs in 2018-2019, but significant investments will be made within distribution and marketing related to increasing brand awareness, Company executives said.

Overall group revenue growth for the coming fiscal year is seen at above 10% compared with a year earlier.

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