Despite the attention, online sales contribute little to JB Hi-Fi’s revenue

By Patrick Avenell

Although JB Hi-Fi’s online sales are “important” to the retailer, they still equate for only 1.6 per cent of all sales turnover, according to CEO Terry Smart. For comparison, Harvey Norman’s “omnichannel” sales are around 1 per cent of its total revenue.

This low percentage of turnover, despite the fuss caused by JB’s ‘Factory Scoop’, ‘JB Direct’ and ‘JB Now’ online products, shows that bricks and mortar sales are still, by far, the important part of the publicly listed company’s business.

“While sales directly transacted through the online site are still relatively low at 1.6 per cent of total sales, the site remains an important driver of both in-store and online sales,” said Smart.

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JB Hi-Fi recorded $3.13 billion in sales for the 2012 financial year (up 5 per cent) and a net profit after tax of $104.6 million (down 22 per cent, when not including the one-off Clive Anthonys’ restructuring cost).

Although both the revenue and net profit results declined year-on-year, Smart put a positive spin on the results, noting that it is still a good performance in what is a very difficult economy for retailers.

“The strength of the JB Hi-Fi model continues to prove itself at both the top and bottom of the retail cycle,” he said. “The core of our success is a best-in-class cost base which has enabled us to manage abnormal levels of price deflation and competitor discounting whilst continuing to trade very profitably.”

JB Hi-Fi finished the 2012 financial year with 168 stores spread across its JB Hi-fi and Clive Anthonys brands in Australia and New Zealand.

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