What Next For JB Hi-Fi?
The future for JB Hi Fi looks very promising with the big CE and appliance retailer now looking at how they can get bigger returns from their stores where floor space is at a premium.
Recently JB Hi Fi moved to introduce new merchandising displays that don’t take away from space utilisation in their stores while The Good Guys is moving to pack more brands, especially premium European appliance brands into their floorspace which CEO Terry Smart and his management team have restructured to deliver higher returns.
One issue facing the group who yesterday revealed that sales surged 23.7 per cent to $4.9 billion, off the back of demand for consumer electronics and white goods is that the lack of a live CES Show where new products are shown saw less new products revealed than would have been for a live show attended by thousands of Australian retailers and their suppliers and this could translate into a lack of new products in stores in 2021.
CE and appliance Companies whose staff have been lockdown due to COVID-19 for several months are struggling to deliver new products for 2021, also impacting supply is a shortage of processors resulting in retailers such as JB Hi Fi and The Good Guys facing supply problems which have eased in January, also impacting retailers is lockdowns with suppliers struggling to get meetings with buyers.
The good news is that Australians are sitting on $100 Billion in savings and Australian Federal Government officials are claiming that they see little chance of overseas flying being approved until the end of 2021 resulting in analysts tipping that consumers will continue spending despite a cut back in Government handouts set to go into effect in March.
What is a real standout at JB Hi Fi is their earnings which before interest and tax surged 76 per cent to $462.7 million, net profit rose 86.2 per cent to $317.7 million?
Another big performance online saw sale grows by 161.7 per cent to $678.8 million, representing 13.7 of total sales.
Currently the group is concentrating on stock they already range, buyers are struggling to introduce new brands unless there is a compelling reason because of a lack of new floor space in the JB hi Fi stores
The introduction of a new brand could well see the exit of an underperforming brand. Recently the group has taken on short term brands to fill a space where a traditional supplier has been unable to supply such as in the TV category.
At The Good Guys management has introduced the premium European TV brand Loewe with their products currently being rolled out to 60 stores. The brand is also launching a new audio range this year and later in the year whitegoods.