Duplicate Carphone Warehouse and Currys/PC World stores could be under threat following the £3.7bn merger of Dixons Retail and Carphone.The companies have said that 850 redundancies are on the cards in operational and support roles at head of? ce. But they will also review overlaps in the store portfolio. Dixons has already successfully merged Currys and PC World stores that were near each other.However, Carphone CEO Andrew Harrison told Mobile: ‘This deal is not predicated on any store closures whatsoever, and there are no store closures in our plan.‘Some of our most pro? table stores are on the retail parks,’ he asserted, adding that they often compete with a Phones 4u trading inside a Currys store. ‘When we had Carphone stores near our Best Buy stores, the traf? c was incredible and we did really well. So it does not necessarily follow that stores
will close because they are close by.’However, industry sources believe that cost saving is one of the bene? ts of the merger. ‘There are three ways to look at this: A defensive move because Carphone and Phones 4u are now seeing a challenge in the market; the rise of the Internet of Things; and thirdly there is the opportunity for cost savings,’ said Kester Mann of CCS Insight.‘There is always a degree of cost savings in these things – although the store bases don’t con? ict with Carphone on the high street and Dixons out of town,’ said Keith Bowman, equity analyst at Hargreaves Landsdown.However, an analysis of 172 Currys-PC World stores by Mobile found that in 33% of cases there was a Carphone Warehouse within 250m. A Carphone spokeswoman said that store overlaps would be looked at.
She cited Staples Corner in London, a trading estate housing both a Currys/PC World and Carphone Warehouse store, as an example of a location where stores could be merged. The study by Mobile found neighboring stores in 58 of 172 locations examined, with close overlaps in places like Basildon, Thurrock, Croydon, Bristol, Bath, Cambridge, Milton Keynes, Birmingham, Shef? eld, Leeds and Manchester’s Trafford Centre.However the spokeswoman stressed: ‘We haven’t even begun to look at it or made any decisions, even at a high level, of what we might do in the situations where we have two stores. Any changes would be a long way off.’The merger, announced last week, will see the creation of Dixons Carphone, a company with a store portfolio of over 1,200 stores and around 4,300 staff.