As revenue takes a hit.

Thorn Group has reported a 15% fall in revenue to $236.2 million due to tougher conditions in consumer leasing with Radio Rentals revenue down 22% year-on-year. Thorn chairman, David Foster said 2018 was a challenging year for the group and the disappointing results should be considered in light of this.

“I don’t believe it is an exaggeration to say that 2018 was perhaps the toughest in the Group’s 81 year history,” he said. “To face these challenges the board and our senior management recognise that to succeed, we must continually adapt in a rapidly changing regulatory and business environment.”

Following the appointment of managing director and CEO, Tim Luce earlier in the year, a review is now underway for Radio Rentals and includes new store concepts, a wider product range, more flexible pricing and more extensive promotions.

Other changes to the operating model include centralising backend processes, extending store trading hours, improving online and social experiences and technology enhancements of credit assessment, stock availability and after sales service.

“We must remain mindful that Radio Rentals is a well-recognised retailer with an established and respected brand throughout Australia and is a market leader in consumer leasing,” Luce said.

“Change is an inevitable and necessary consequence underpinned by our manta to provide our customers an amazing customer experience. This is not a marketing strategy: our customers are and must continue to be the central focus of our attention.

“We have recently engaged a strategic partner to perform a review of the business and identify main areas to improve efficiency and performance. This is being driven internally and will provide the basis of the new Radio Rentals operating model.

“The key focus areas of this project include credit verification and collections, supply chain, distribution, warehousing and servicing, and corporate cost reductions.”

Aftert a successful trial in some Sydney stores, including Chullora, Blacktown, Macarthur Square, Mount Druitt and Parramatta, Thorn will move into a period of store refurbishment over the next 18 months. “I am pleased to report that all of the refurbished stores are trading positively since their refit.”