Department store operator Myer's new results have revealed the impact of its decision to stop reselling Apple products: falling sales but growing profit.
Myer announced its intention to dump Apple in March 2019, on grounds that it wanted to devote shelf space to higher-margin products. The retailer said it had tried to negotiate better prices with Apple, but couldn’t make a deal. So it emptied its shelves of fruity phones and computers by May.
And in its annual results announcement (pdf) released yesterday, the company revealed its first net profit growth in nine years, having made it into the black by $33.2 million for the year with profit growth of 2.2 percent.
The numbers weren’t all nice: sales fell 3.5 per cent to $2.99 billion and same-store sales dropped by 2.9 per cent.
But in its results announcement Myer five times pointed out that the same-store sales figure was only down by 1.3 per cent once quitting Apple was taken into account.
Execs also crowed that their plan to pursue high-margin fashion brands that sell exclusively at Myer paid off, and helped the chain to solidify cost-cutting gains that came from renovating and shrinking stores (and closing some too).
None of which will worry Apple, which in July posted record Q3 revenue of US$53.8 billion (AU$79 billion), 59 percent of it from outside the USA.
Myer was also chuffed with its online store, which grew quickly and accounted for 9.8 percent of sales and was counted as its largest single store. The company also said IT costs dropped, which helped to boost profit. Perhaps one of you out there in the channel can tell us how that happened, or how you’re helping Myer with its stated aim of improving its supply chain.
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