DSG’s perilous state requires Phones 4u’s help

DSG’s perilous state requires Phones 4u’s help

The location couldn’t be better. DSG’s largest megastore is in Wednesbury, on the doorstep of Carphone Warehouse’s distribution centre. But while the location has raised a chuckle, the unlikely alliance of Phones 4u and DSG shouldn’t be scoffed at. Both retailers are currently going through a tough period but the partnership makes perfect sense. Phones 4u has seen the size of the market shrink rapidly, but DSG is in a more perilous state.

Sales have not stopped sliding over the past three years, suggesting its problems go further back than those linked to consumer spending and securing credit for suppliers. (Only last week, DSG was asking suppliers for 90 day payment terms instead of the more conventional 30 days, adding to the anxiety many suppliers feel towards DSG). Its retail brands feel increasingly detached from the world of converged products and technology. The in-store service levels also fall short of the demands of the modern shopper.

Forget Best Buy and Carphone’s ambitions, DSG’s patch has been well and truly invaded by a retailer perceived as twee and far from aggressive – John Lewis. DSG should not have let a fusty department store take so much of its share of the consumer electronics market purely through service.

But this new partnership reveals DSG’s need for external expertise, capability and buying power for phones and other connected devices of the future. It is a hoisting of the white flag from the company that used to own The Link chain of mobile retailers and now declares it can no longer sell mobile phones on its own.

For Phones 4u, it appears a smart, low risk and perhaps realistic move to challenge Carphone’s Wireless World format.


The location couldn’t be better. DSG’s largest megastore is in Wednesbury, on the doorstep of Carphone Warehouse’s distribution centre. But while the location has raised a chuckle, the unlikely alliance of Phones 4u and DSG shouldn’t be scoffed at. Both retailers are currently going through a tough period but the partnership makes perfect sense. Phones 4u has seen the size of the market shrink rapidly, but DSG is in a more perilous state.

Sales have not stopped sliding over the past three years, suggesting its problems go further back than those linked to consumer spending and securing credit for suppliers. (Only last week, DSG was asking suppliers for 90 day payment terms instead of the more conventional 30 days, adding to the anxiety many suppliers feel towards DSG). Its retail brands feel increasingly detached from the world of converged products and technology. The in-store service levels also fall short of the demands of the modern shopper.

Forget Best Buy and Carphone’s ambitions, DSG’s patch has been well and truly invaded by a retailer perceived as twee and far from aggressive – John Lewis. DSG should not have let a fusty department store take so much of its share of the consumer electronics market purely through service.
But this new partnership reveals DSG’s need for external expertise, capability and buying power for phones and other connected devices of the future. It is a hoisting of the white flag from the company that used to own The Link chain of mobile retailers and now declares it can no longer sell mobile phones on its own.

For Phones 4u, it appears a smart, low risk and perhaps realistic move to challenge Carphone’s Wireless World format.

Written by Mobile Today
Mobile Today

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