Retravision CEO Refutes 12 per cent Market Share Prediction
By Martin Vedris
SYDNEY: Retravision CEO Keith Perkin today refuted the prediction by retail analyst Credit Suisse that Retravision’s market share could drop to just 12 per cent by 2010 as "merely speculation" and without any consultation with the national retailer.
In a report released yesterday on the status of the electrical retailing market in Australia, Credit Suisse claimed that Retravision's market share could fall to 12 per cent by 2010 after holding about a quarter of the market just five years ago.
Credit Suisse highlighted the reasons for this potential decline are based on recent events including the Retravision NSW being put into receivership and subsequent company wide restructuring, including the recent announcement to close the national office as well as the retail group losing 16 stores in NSW primarily to Harvey Norman and Narta.
The Credit Suisse report stated: “The store defections and declining competitiveness of Betta and Retravision has eroded their once dominant market positions. Market share is estimated to have fallen from approximately 40 per cent in 2000, to 20 per cent in 2006 and is forecast to deteriorate to 12 per cent by 2010.”
In response, Perkin today told Current.com.au: ““That report is simply their view and does not take into account our future network plans or likely store developments. I would therefore class these comments as merely speculation.”
The opening of Auburn Retravision by Retravision Retail Pty Ltd, a wholly owned subsidiary of Retravision Southern Limited, on June 1 is one example of the group’s network growth strategy. That store is taking on The Good Guys in the Home Mega Mall complex, nearby Narta members Clive Peeters and Seconds World as well as Harvey Norman’s Flemington store and its mid to high-end electrical and furniture retailing business – Domayne.
Also, as previously reported on Current.com.au, Retravision Western has also developed a Large Format Store (LFS) concept with a pilot program of 10 stores over 1,000 square metres. The LFS outlets grew from representing 27 per cent of the group’s business in the nine months to 31 March 2006, to representing 31 per cent of the business over the same period year on year.
Yesterday Current.com.au reported that the Credit Suisse research also suggested that consolidation in the industry could provide the opportunity for retailers such as Harvey Norman to increase fees for franchisees.
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