Consumer electronics high street stores have long been under pressure from their online counterparts and once again a major shake-up is about to take place.
DSG International, owner of the Dixons and Currys.digital brands, has announced it will slash the number of high street branches of the latter by almost half with 77 of 177 stores (43 per cent) set to disappear from our streets.
DSG said the closures will be allowed to happen naturally with the company choosing not to renew the leases on certain branches as they expire over the next five years. The move is aimed to help DSG reduce costs by up to £50m during the 2008/2009 financial year. It declined to say how many staff redundancies would result.
A "new store format" is also being implemented in both Currys.digital and PC World (DSG's other big fish) which it hopes will reinvigorate stores. The first trials will begin through Christmas 2008.
Ultimately, these moves come as DSG has been suffering a tough time of things. It has issued two profits warnings in 2008 already and its position in the 'luxury goods' sector is said to have seen it more affected than most by the recent greed of banks economic downturn as customers cut back on spending.
Will the latest moves help? Perhaps to an extent, but if you ask me Currys.digital is facing a rocky road ahead...
Press Release (PDF Warning)