PC World profits slump
PC World's mothership has announced a massive drop in profits, perhaps reflecting the popularity of web-based retailers.
Like-for-like sales throughout the company have dropped one percent in the six-month period leading up to April 2008, and while that might not seem like a massive figure it has lead to a £30 million drop in profit for the chain – a massive blow in difficult economic times.
Browett singles PC World out as a particularly poor performer, reporting PC sales as being ten percent lower than anticipated. He describes the slump as evidence that “customers have become increasingly promotion- and deal-driven.”
The massive slump in pre-tax profits follows a warning issued by the company in January of this year, when the group describe trading over the Christmas period as being extraordinarily weak. The warnings are enough to make investors ponder, too – DSGi shares dropped nine percent yesterday after Browett issued his statement.
While the chain is in no danger of folding quite yet, it's clear that the ever-increasing number of online computer retailers with no bricks-and-mortar presence offering cut-price goods – often half the price as is available from PC World and its ilk – combined with the currently weakened consumer environment is going to lead to some belt-tightening all round.
Browett, who joined the company from his previous post at supermarket behemoth Tesco in June 2007, is expected to announce the first results of his review of the business on the 15th of May this year. Whether job cuts or store closures are in the pipeline isn't yet known, but it's clear that money will have to be saved somewhere if investors aren't going to start fleeing the sinking ship.
Do you ever shop in a high street store for your components, or would you only be seen dead in a PC World for those late-night “I've just fried my graphics card and I need my WoW fix” emergencies? Discuss over in the forums.
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Discuss in the forums ReplyI've never heard if either of them :?
Now there's an idea!
PC World have been pretty decent recently; I bought my HDTV there as they were the same price as online (but wouldn't add the shipping costs) and a good £300 cheaper than any of the other high-street retailers. They also honoured their "webprice" for a couple of items that were expensive for their instore price, but rivalled or bettered e-tailers when the online price was used... and again, no cost of shipping.
Being able to take something back to a physical store has it's advantages, too, as Leitchy says... return shipping costs for some things really start to add up.
Prices that miraculously increase between the shelf price and the till price, boxes on display only to find after a ten minute wait at the till that there's none in stock and the incessant demand for more and more personal data for less and less good reason, who's surprised punters are voting with their feet?
While I realize PCWorld/Currys can never really offer the cut prices of online stores, there is reason. For example about 5-6 years ago I was building my first network at home, I was looking at network kit from net gear for £32 online, in the PCWorld Store it was £99.99 and that was a "Special Offer". Thats more than a reasonable price hike!
Also Maplin should die a slow and painful death imo, £14.99, for a D-sub to DVI converter. That are what, worth 50p? £1?
If that happens, it's quite easy to take the price label off the shelf (or get one of the staff to come look at the label) and kick up a stink if the till magically makes it more expensive. ;)
...
Maplin are pretty bad too - but it does depend greatly on what you want to buy. They overcharge for the most silly stuff, but then other items are cheap. Same as everywhere else, to be honest - you need to shop around. :)
Once brought a cheap replacement GFX card after my last one fried in order to stop my COD:UO withdrawal symptoms! Only about 1 – 1 ½ years ago!
And second to get a HDMI cable to try the PS3 out on a HDTV.
But yeah they aint' great places to go for puta stuff, perhaps they'll buck their ideas up.
Drop the prices a fair amount, train the staff so as to be able to 1) serve the customer without coming across an imbecile and 2) actually answer questions at least semi-intelligently rather than (seriously! they did this to me once) MAKING STUFF UP, and the place would become decent.
Currys is just crap and should die, on the other hand.
Now, whilst we were looking at a few of the laptops, a japanese man came in and spoke to a sales assistant on the floor, asking 'what's the best laptop I can get for £1000'. He was clearly in the market for one, well dressed etc. He asked about what to look for in the spec of a laptop, and if the guy could reccomend him anything in particular.
The sales assistant simply said 'the details are on the bits of paper', pointed to the little flap of paper stuck to the shelf next to each laptop, and looked blankly at the man.
The man asked again, explaining that he didn't know much about laptops, and that he would like help choosing. The assistant responded in the same fashion. "Everything you need to know is on the spec sheet".
Then he walked off, leaving the japanese man to look at the laptops on his own, beamused.
No wonder they aren't making any money.
Also, the spec sheets do NOT cover all the details. They mention processor (Dual Core!, not megahertz), the Ram, and the Hard Drive. They give no mention to graphics, accessories, ports, or any other information that might be needed for anyone spending a serious amount of cash on a laptop.
Useless.
Go on, I'm dying to know...
Andy
Likewise their customer support is utter crap. It took almost 3 months for PC World to replace a failed HDD in my brother's laptop last year (thread about it here I think). A 2m USB cable costs £14.99. They target the unknowledgable with their non-knowledge.
The problem with the UK that PC-World is practically the only PC chain around. Bit-Tech would do well to create their own high street store :D
I love putting PC World down because frankly, they deserve it.
You sir, must realise how it is that your company makes profit and why people would hate that (not necessarily you). While you may not be part of the problem, but it is a fact suggested by this article and indeed forum posts that people are no longer prepared to buy over priced and sometimes over adequate goods. People want a fair deal, I think it is sad that when a companies profit dips they can blame "deal driven consumers"... o sorry I thought, like you said on the tv that you gave us good deals? No of course you dont, ripping people off is how you make your money! You will forgive us if we "tar" you, but cancer like this shouldn't be part of our streets.
The training was more on how to sell the product on about the product, it may have changed since I worked there but I doubt the people at the top seem to care until the money stops coming in. The customer maybe less knowing on the product they want, but are more savvy on what is the best deal, just look at all the websites that have sprung up to help the public get the best car insurance, gas company etc.
FOR SURE
"You, sir?" I'm just working there part-time whilst at university mate, "my" company's prices has absolutely nothing to do with me.
They make their money from credit agreements (alcoholics paying £30 a month for 4 years for a 50" plasma TV they don't need) and product support.
Also, "cancer like this shouldn't be part of our streets." Are you serious? I think you're taking it a bit too far...
However, I have bought a few things from PC World when they have deal on and found the service to be more than adequate, that aside I know what I'm going in to buy before I get to the store in the first place.
I have also found their RMA process to be great, just pop back in with faulty part and receive a replacement or refund right there and then.
I do agree that they tend to prey on the un-knowledgeable, but which high street electronic store doesn't (maybe Maplins is the exception here)
Plus they cheat... Their website, ads, and marketing material claim the prices are the same in store as online (that "Online prices to take home" crap), but to get around this they change the model numbers just slightly so that they can charge more in the retail shops but advertise to the contrary.
I will NEVER buy anything from them again.
I don't shop there often, but when I have they have been fine.
1. you know what you are looking for
2. know what the price is elsewhere before going in.
I got a webcam from PCWorld, and on my mobile (running windows mobile, so full internet access) I checked the online prices of several places whilst I was in the store.
It turned out that they (PCWorld) had the cheapest price online.
I asked if I could have it at their online price (it was £10 cheaper) and showed their site open on my mobile.
"sure, just show it to the person at the till"
I did, and got the lower price.
And if I suddenly run out of printer toner with an important job to do, nice to know there's a store half-an-hour away.
And I agree, many of the people I work with are employed soley on their ability to sell stuff to unknowledgeable customers. While I can see the company needs to make a profit, some of the tactics used are just wrong.
I also agree wholheartedly that many of the staff know a bit about the basics of PC's and peripherals, but nothing like they should know. It looks bad when I have most of the sales people running to me all day with questions about specs, connections etc.
I try to give the customers a fair deal, matching the online price where possible, but at the same time keep my job (and a roof over my head).
If there were more people like the few of us that actually care about the customers needs, then it would be a good place to shop, until then, a lot of people will continue going home with a bad impression.
So, it's little wonder their profits are down when they actively don't sell you stuff.