By Patrick Avenell
SYDNEY, NSW: BigBrownBox was not performing to a high enough financial standard to continue under the Thorn banner, though neither Radio Rentals nor Rentlo are at risk of being shelved, according to Thorn Group managing director John Hughes.
Following on from last week’s shock announcement that Thorn Group is now planning on selling its 100 per cent stakeholding in BigBrownBox, Hughes explained the thinking behind this decision, saying the Group is now focused on its rental appliance business and its financial services.
“It’s pretty clear to anyone in consumer electronics that the trading conditions have tough, soft, poor; whatever you like to call them, and that everyone’s been finding it not as good as it was a couple of years ago,” Hughes said.
“We looked at it [BigBrownBox] and looked at the retail market and said, ‘how long is it going to be before this thing really starts to give us the sort of return on investment that we look for’, and we just don’t see things improving significantly for at least another year to two years.
“We then reviewed that in light of other strategic initiatives that we’ve been considering, that are on the books, and we said that we’re better to put both our management efforts and our investment into one of these others, rather than continuing along with BigBrownBox.”
Hughes said there were a “couple of interested parties” currently looking at purchasing BigBrownBox, though he declined to name any or to place a value on the online appliance and consumer electronics store.
Looking to the future, the disposal of BigBrownBox will leave Hughes and his fellow executives to focus on the expansion of the Radio Rentals and Rentlo customer base, which will be stimulated by the introduction of kiosks in malls and shopping centres. Also on the agenda is aggressive growth of Thorn’s financial services division.
“Our focus as an organisation is more on financing of product, and we do finance quite a myriad of things, through our various business arms,” Hughes said. “We’re best known for Radio Rentals and Rentlo, but right now we have a significant and growing number of vendors that we finance — finance their clients — in a number of areas, including health, housing, et cetera.”