JB Hi-Fi self-branded foray into retail home appliances is a very competitive, warehouse-style proposition, according to research conducted by CIMB Equities director – retail, Daniel Broeren.
Having previously marketed appliances in its Clive Anthony’s-branded retail outlets, JB Hi-Fi has been embarking on a new JB Home concept, which trades off JB Hi-Fi’s very strong name in consumer electronics.
Broeren, an expert in analysing publicly listed retailers, visited JB Home’s Moore Park outlet yesterday, discovering that, broadly speaking, JB Home’s listed, pre-negotiation prices are cheaper than the Harvey Norman store in the same retail precinct.
“We conducted a price check to determine the appropriateness of ticket pricing, pre negotiation,” Broeren reported. “Small appliances pricing on-average matched the Harvey Norman in the same centre. Bulky appliance ‘ticket’ pricing was, in almost all cases, lower than Harvey Norman.
“Importantly, this should give JB Home a seat at the table for negotiation.”
Some of the bigger price differentials noted by Broeren included a Sunbeam iron (19 per cent cheaper), a Simpson clothes dryer (29 per cent) and an LG refrigerator (11 per cent). The biggest price difference in Harvey Norman’s direction was on a Nescafe Dolce Gusto coffee machine (20 per cent).
Broeren noted that JB Home’s strong suit is small appliances, which take up less shelfspace and are easier to sell in volume, due to their significantly lower price points.
“The small appliance offer was particularly good,” he said. “The range was smaller than a full size Harvey Norman store, but sufficient in our view. “The kitchen range is small and unlikely to challenge Harvey Norman or specialist retailers.”
JB Home has chosen to merchandise its appliance offering with a near identical approach to its JB Hi-Fi consumer electronics range. There are eye-catching shelf talkers and hand drawn signs, while the same casual font and colour scheme has been employed. This is a notable differentiation from competitors, which tend to favour a more serious approach to appliance merchandising.
Part of JB Home’s “particularly good” smalls ranging.
Broeren said the kitchen range was smaller than competitor offerings.
The busy, no-frills displays are consistent with JB Hi-Fi’s electronics stores.
Hand-written signs are used throughout JB Home.