Currys Sales Slump Amid Shortages of Key Technology Products | Retail business | Latest News Headlines

Currys Sales Slump Amid Shortages of Key Technology Products | Retail business

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Currys cut its annual profit forecast after a shortage of products ranging from PlayStation 5 consoles and Apple products to hairdryers led to a 5% drop in sales during the Christmas peak period.

The UK’s largest electricity retailer said sales have been affected by issues such as the global chip shortage, which is affecting the supply of products ranging from televisions to home appliances, the shipping of products and a drop in demand as household budgets are increasingly tight.

“The tech market was tough this Christmas, with uneven customer demand and supply disruptions,” said Alex Baldock, managing director of Currys, formerly marketed as PC World, Carphone Warehouse and Dixons. “We’ve certainly had our hands full this Christmas with sourcing, not only of products but also of people, containers, chipsets, the whole line.”

Currys, which cut its full-year profit forecast from £ 160million to £ 155million, said the overall UK market for tech product sales was down 10% at Christmas.

“We are seeing uneven consumer confidence in ticket purchases that are larger like electricity, like the technology that we sell,” said Baldock, speaking on BBC Radio 4’s Today program. It certainly wasn’t helped by the cost of living issues, and it wasn’t particularly helped by Omicron either. Yet even with this uneven customer demand, we were able to continue to grow and gain market share. “

Currys, which operates 800 stores and sells its products online, said sales in the UK and Ireland fell 6% year-on-year during the 10-week peak period leading up to January 8. As consumers turned to selling online to avoid taking to the streets, with digital revenues up 29% from Christmas 2019, that was not enough to overcome the overall drop in sales of the company during the 2021 holiday season.

Despite the business issues, Baldock said the company was profitable and outperforming the wider market.

“Customer demand for certain technologies was strong,” he said. “It was gamers’ Christmas, the year virtual reality hit the mainstream and consoles flew off the shelves. Oculus Quest 2 and the PS5 were stars. Large and small appliances also saw strong sales as consumers continued to equip their homes. While not everyone might have had their first choice of product this Christmas, we had plenty of choices for everyone.

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The company said that for the 36 weeks leading up to Jan.8, sales were down 3% year on year but up 11% from 2020. Baldock said Currys, which launched a buyout program on Friday of shares of £ 75million, focuses on “profitable sales, with good discipline on margin, cost and inventory”.

However, he added that there continues to be pressure on the supply chain and consumer demand.

“I don’t expect an improvement,” he said. “There are a lot of uncertainties, not only on the supply side but also on the demand side for the future, whether it is the cost of living, real wages, discretionary income or consumer confidence, which is one of the reasons we’re pretty cautious. in our outlook.

Shares of Currys fell 4% on Friday morning.

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