Like most retailers in the industry, stock availability continues to be the number one focus for both JB Hi-Fi and The Good Guys buying teams and according to group CEO, Richard Murray, they have done an amazing job.
“Stock has been a constant challenge for the last 12 months,” Murray told investors when presenting the group’s financial results for 1H FY21.
During the half, total sales for JB Hi-Fi increased 23.7% to $4.9 billion with online sales skyrocketing to $678.8 million, up 161.7% on the prior corresponding period.
EBIT was up 76% to $462.8 million with net profit after tax (NPAT) up 86.2% to $317.7 million during the six-month period.
“I am personally blown away by what the team has achieved with the sales numbers given the jarring stock arrivals. In our FY20 results presentation, I believe I said I never thought we would be able to achieve strong sales numbers with this level of inventory,” Murray said.
Strong sales momentum continued into January with total sales growth of 17.3% for JB Hi-Fi Australia, compared to 6.5% in January 2020 and total sales growth of 14.1% for The Good Guys compared to modest growth of 1.4% in January 2020.
For JB Hi-Fi the stand-out categories are communications, computers, visual, games hardware and small appliances, while sales at The Good Guys are being driven by strong demand in refrigeration, small appliances, laundry, floorcare, TVs and computers.
However, Murray said out of stocks impacted January sales, particularly in TVs across both businesses with The Good Guys struggling in other areas including seasonal.
Since the start of Covid-19, JB Hi-Fi has been focused on its inventory levels and the group is now taking all it can get and stock levels have never been healthier.
“We are working hard with different vendors and existing vendors to get as much stock as we can due to increased demand. We just buy what we think we are going to sell and if we are out a bit, we just slow the next order given that most of our orders come in weekly.”
Looking ahead to the remainder of 2021, Murray said: “For The Good Guys, the housing cycle and renovation market has been solid and for JB Hi-Fi, when people have money to spend, they tend to shop with us so we are comfortable with the outlook for both businesses.”