Carphone Warehouse eyes growth in the laptop and tablet markets

Carphone Warehouse is branching out into laptops and tablets. Photo: Getty
HIGH street retailer Carphone Warehouse yesterday unveiled plans to sell more laptops, tablets and other electronic gadgets to make up for slowing sales of pay-as-you-go mobile phones.

The firm last year closed its 11 “big box” out-of-town stores in the UK, which had been launched under a joint venture with US giant Best Buy in an effort to take on Comet and Currys in the home electricals market.

Carphone’s latest venture, under the “Wireless World” brand, will use its existing stores to sell smaller gadgets such as Kindle e-book readers.

Chief executive Roger Taylor said: “We can sell those in a much smaller retailing environment. You do not need a 30,000sq ft box to sell what I think is going to be interesting in consumer electronics retailing.”

About 300 of the firm’s 2,400 stores across the UK and Europe have already been re-branded, with the total expected to rise to 375 by the end of March.

Sales of laptops, tablets and other non-mobile phone products at the company’s stores rose by 15 per cent in the three months to 31 December, according to new figures.

But such products still only account for about 10 per cent of the firm’s turnover, leading Taylor to believe that the firm can grow this area of its business despite stiff competition and weak consumer spending.

Like-for-like sales fell by 4.7 per cent in the 13 weeks to Hogmanay – the company’s third quarter – worse than analysts’ predictions for a 4.2 per cent drop and deeper than the 3.9 per cent decrease posted in the first half of its financial year.

The number of customers the firm connected to phone networks dropped by 16.6 per cent, with pay-as-you-go (PAYG) handsets the worst hit.

Carphone Warehouse estimates that the PAYG market as a whole in the UK was down by 35 to 40 per cent in the run up to Christmas because of a lack of subsidies from networks and fewer smartphones being available to customers.

Taylor warned that the company was losing up to £50 million in sales from the PAYG sector and that they were unlikely to be directly replaced.

But he was more up-beat about the pay-monthly market, where many customers were upgrading to the Apple iPhone 4S or Research in Motion’s latest BlackBerry as they came to the end of their 24-month contracts.

Analysts at Citi said: “Carphone Warehouse offers growth via the accelerated roll-out of the smartphone, tablet, accessory and service format ‘Wireless World’, together with the benefit from new network terms.”

See: Profile

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