EXCLUSIVE: Aqipa Dump B&O AS Things Go From Bad To Worse At Danish Company
Melbourne based Aquipa has confirmed that they have dumped struggling Danish Company Bang & Olufsen citing a lack of margin, it is the second time in 18 months that the brand has been dropped by a distributor.
In Australia the Aquipa/Bang & Olufsen relationship was via Singapore based MJ Group who were also looking for a margin on the products sold by Aqipa in Australia, ChannelNews was told this was over 14% making any relationship difficult for any distributor.
A senior Aquipa executive confirmed the dropping of the Bang & Olufsen brand.
Late in 2018 the Melbourne based Kennedy Group walked away from a relationship with Bang & Olufsen when the Bang & Olufsen retail stores proved to be unprofitable.
ChannelNews understands that at this stage no other distributor has expressed an interest in the brand that is facing serious difficulties worldwide.
Aquipa are also dropping the Master and Dynamics headphones that have had limited success in Australia.
Instead the Company is expanding distribution of the Marshall range of headphones and speakers will later this year roll out a new range of tin ear and over ear Adidas sports headphone. The over ear headphones have what looks like stylish shoelaces as cords.
Aquipa are also currently rolling out a brand-new German sound range from Braun that sounds better than the current B&O offering and is significantly cheaper. (see separate story).
This range will replace Bang & Olufsen.
The speakers that ChannelNews saw at IFA and CES 2020 are stylish and have that minimalistic European look that is proving popular worldwide with retailers in Australia expressing “A lot of interest” in the new offering.
The dumping of Bang & Olufsen comes as the global Company faces a crisis, during the past 12 months their share value has gone from 100 kroner to 34.1.
It appears that it is not only distributors who are losing patience with the Danish Company. Investors are also dumping the stock as the Company shops around for funding.
Sales last month were considerably lower than expected, B&O said in a statement, prompting the shares to plunge 25% in Copenhagen. The decline takes this year’s stock loss to almost 63%, the second-worst return on the 132-member OMX Copenhagen Index.
“All alarm bells are ringing, and who can have the confidence that there won’t be a fifth, or maybe even a sixth profit warning,” said Per Hansen, an investment economist at Nordnet in Copenhagen. “It ought to be clear that B&O’s future is not as an independent company.”
Bloomberg reported that the company’s troubles highlight the changing tastes of consumers who prefer listening to music on mobile devices or choose unobtrusive speakers over extravagant sound systems.
Bang & Olufsen sales will be down as much as 18% for the past 12 months, compared with a previous forecast for an expansion.
Operating profit and cash flow will also be worse than predicted earlier.
ChannelNews expects that the Company will make a major announcement later this week with the Company tipped to announce another round of poor results. A new three-year plan won’t be presented until April however some observers are now claiming that the Company could be sold in 2020.
Cristian Tear, a former Blackberry Ltd. manager who joined as chief executive officer in October. Tear said the strategic direction of the company remains unchanged, but that “fundamental change of the sales and marketing efforts is required.”