The crisis atmosphere in the Bang & Olufsen offers now resonate completely out of the individual B & O stores to close after another. With the many deaths it will be impossible for B & O to achieve its growth target, analysts predict.
Life as a B & O dealer has been anything but easy the past years. It must be Bang & Olufsen Group truthful, after no less than 38 European B & O shops have had to turn the key on the last three quarters.
Consumers have turned into large scale B & O back, and with the financial crisis took the B & O sales virtually stagnated. It has sent the Struer-based audio and visual group from a massive crisis where earnings rattle down and the stock price has followed suit. And now follows including dealers the same way.
Only the first three months of 2009 has given some 18 deaths of the group known as B1-shops, so dealers who only sell B & O products.Thus, B & O worldwide approximately 780 stores and, according to B & O analyst at investment bank Carnegie, Lars Topholm are many store closures a problem for B & O, which drastically needs for growth.
"It is critical, because basically, their revenue based on two things: what the store sells and how many new stores they open," says analyst and stresses that a large part of the problem is that only the European shops closing.
"It would not be so critical if they were big around the world, but they are still in a situation where the largest proportion of turnover comes from Denmark, Britain and Germany alone, and when you have such a centralized, you really beyond the step, to attract new dealers, "says Lars Topholm.
B & O is not only to suffer death in the shop these days, but the subject was Struer company can store closures have dramatic consequences, says the Carnegie analyst. He expects that B & O will have unusual difficulty in its growth next year, which sounds to the turnover in 2009/10 will land at 3.2 billion dollars against 2.8 billion dollars this year.
"In their turnover included an expectation that the dealers will increase by nearly 15 percent, and I think this is utopian. For three quarters, they said goodbye to almost five percent of their dealers, and that means that the first five percent revenue growth only brings them back to square one. Thus, each retail sales grow 20 percent, and it has never happened before, "says Lars Topholm.