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sure you've got that right?
Is it opposite day today and everybody told me?
Hurray! People, from at least one phone retailer, are going to lose jobs!
OP was evidently so excited about this, he completely booshed the facts.
Edit: ohnoyoudont
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It's not a good day for the job market in stoke on trent. Thousands of families affected, over 4k in the head office in chesterton, very sad.
Corrected.
Given the 'experience' I had when I visited my local branch twice within the last ten years to price check I'm surprised they lasted this long.
Best wishes and the best of luck to all those affected.
Ninja editing 🙁
Blimey! Thats a lot of jobs. Feel sorry for the poor sods waiting to find out whats happening and expecting the worst 😥
That is bad news. I always did wonder how their business model worked for the networks as their role was basically to undercut them. I've had some good deals from them in the past. In fact, I was looking at their site yesterday for a new contract for MrsN - glad we didn't sign up to anything...
Anti competitive move from the oligopolist telecoms firms.
A mobile operator doesn't walk away from potential huge lost sales to them without a very good reason. I wonder if Phones4U was paying when it should or with long overdues on purpose etc?
In addition I avoided Phones4U like the plague. Hideously pushy and not even that competitive on their deals. Max benefit to Phones4U on payments terms to its suppliers and max profit/bad deals to customers?
Sad for the employees but I imagine alot of ex-Phones4U customers wont feel the loss.
One of their apparent complaints, listening to the radio this morning, was that Vodafone had gone out of their way to make it difficult/impossible for them to offer competitive deals on their network...
How exactly do they do that? The mobile comms business still seems like a bit of a shady one to me anyway...
Given the 'experience' I had when I visited my local branch twice within the last ten years to price check I'm surprised they lasted this long.
They've not gone because they were unprofitable it's because they've had the rug pulled out from beneath them by Vodafone and EE.
Not great https://www.trustpilot.co.uk/review/www.phones4u.co.uk
but have you seen carphonewarehouse? They used to be great too. Not pushy etc but still not as bad as Phones4U but look at their reviews!
https://www.trustpilot.co.uk/review/www.carphonewarehouse.com
That's just phone companies for you though. They all get s**t reviews.
[url= https://www.trustpilot.co.uk/review/www.vodafone.co.uk ]Vodafone[/url]
[url= https://www.trustpilot.co.uk/review/ee.co.uk ]EE[/url]
They've not gone because they were unprofitable it's because they've had the rug pulled out from beneath them by Vodafone and EE.
Very weak business model being solely dependant on one or two massive customers with no long term contract in place though.....
They've not gone because they were unprofitable it's because they've had the rug pulled out from beneath them by Vodafone and EE.
Seems they were too dependent on one or two companies for business.
I agree with that. never really occurred to me what a house of cards those businesses are. Especially when the high streets are full of shops for the big phone companies - why would they re-sell though the likes of Phones4U?
Seems they were too dependent on one or two companies for business.
Not much you can do about that in the mobile telecoms retail market, is there...
Thats quite sad news for the folks that work for them, agreed the business model was a bit lean but sometimes thats all there is out there.
I for one couldn't stand the Adverts, dear God they were awful, but a lot of folks did.
Thats really where thier market was, people not like me.
They could have started renegotiating terms a bit earlier.....
how do you negotiate with someone who refuses to do business with you?
Someone at the supplier didn't wake up one day and say 'you know what lets not do business with them'.
There would have been alot of meetings and to and fro. It wouldn't have been out of the blue- they'd have known there was issues etc.
Go into a 3mobile shop and its a total contrast to a Carphonewarehouse and then... a Phones4U. I like using/trying the features etc and being able to get the handset there and then. 3mobile win.
Dont EVER PHONE 3 though. Sheesh.
Especially when the high streets are full of shops for the big phone companies - why would they re-sell though the likes of Phones4U?
Business model exist(s) or (ed) for the consumer that couldn't be arsed to check the different contracts from different providers and then go into the selected provider's shop. You could go into P4U or CW and get the 'best' deal with the help of the assistant, who'd also help you choose the handset too.
If you weren't available from the shop, then you'd risk missing out. But i suspect that while it is the providers pulling out that has caused p4u to go under, it's also driven by the fact that now most folk are more comfortable at using online means to compare deals and then buy the result, and hence Vodafone, EE, etc., are not so wary that they're missing out.
Companies often diversify in these situations.
how do you negotiate with someone who refuses to do business with you?
If they won't then you know they're going to drop you so you start restructuring asap....
I don't really see how either of these companies Carphone Warehouse or Phones 4U can survive when the phone companies have their own shops.
As usual excessive debt has killed the business, they owe £600m and whilst making £100m profit they can't do that with no phone companies to represent. Anyway the founder will be happy I think he sold out for £1.5bn
Companies often diversify in these situations.
They painted themselves into a corner with the name, tho.
You ain't selling washing machines with a name like that.
when the phone companies have their own shops.
Franchises. As I said I imagine theres more to this. If the staff are quite hardcore/pushy what does it say about the business as a hold? Did they pay ontime etc?
I don't really see how either of these companies Carphone Warehouse or Phones 4U can survive when the phone companies have their own shops.
Because they offer better deals than the phone companies do, which is precisely why the telcos want rid.
I dont see carphonewarehouse selling many carphones these days Jamie 😉
They painted themselves into a corner with the name, tho.You ain't selling washing machines with a name like that.
You reckon?
They could have just started WashingMachines4U and made clear that it was part of the same group - Like EasyJet for example (or do they still do their various Easy... brands).
Or Fones4someoneelse, specifically targeting the mobile phones as gifts market?
One less sales channel for the big networks = less customer churn = lower cost to sell = higher margin.
I guess the model work quite well before the comparison sites and whilst the market was expanding rapidly, but I reckon phones4u must have been a high cost channel to flog phones through
Who would buy instore when you can compare prices online?
I dont see carphonewarehouse selling many carphones these days Jamie
...and that's why they are going bust according to this thread's URL 😀
You reckon?
No. I wasn't being 100% serious. If anything, the *****4U name gave them a decent amount of flexibility to diversify.
Or with a minor rebrand they could have formed a company that sells anything but phones:
Phones?4Q!
They could have worked on a process of recycling old phones into adhesives.
Phones4Glue
....or moved into the Israeli market.
*insert the joke here*
I don't really see how either of these companies Carphone Warehouse or Phones 4U can survive when the phone companies have their own shops.
Well Carphone have just merged with Dixons, so they're now into all sorts of products.
And they exist pretty well because the mobile network operators are still far more interested in selling network access than they are dealing with Joe Public. P4U had clearly come to the end of the road because it hadn't diversified (and also was no longer lead by the talismanic* John Caudwell), whereas I doubt very much there's any trouble at DCPW.
And, of course, the world is all about online these days. All of thes companies are driving their customers online. If you're behind that curve, you're out of business.
*I've worked for him - I usually use shorter descriptive nouns....
Xylophones4U
Or audio market..
Earphones4U 😛
or lexicography...
HomophonesFourEwe?
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They don't have to use the same brands though - British American Tobacco bought all sorts of companies when it worried it was killing its customers to quickly...or something like that.
BT will likely snap up most of the sites as they prepare to launch their 4G network - they are working on quite an interesting quad play strategy to compete with the other fixed and wireless operators that basically works as follows:
- all BT home hubs will get swapped out with 4G home hubs - that "share" the wifi via a hotspot but also use the 4G spectrum now own to create a small cell network
- BT Mobile customers will use the 4G hotspots at home, and outside of that will roam across onto EE's 4G network
- BT will also use their 4G spectrum for wireless broadband per the model with "relish" in London who now offer unlimited home broadband via a 4G box.
Where will these blud's get their tings now?
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Phones4U used to own one of the billing providers for Vodaphone and O2 in singlepoint, but sold it to Voda themselves. This allowed them to sell there own tariffs, this gave them an edge over people like CPW, and also meant there tariffs looked better than Voda themselves, selling singlepoint took the competitive edge off them.
What a crappy deal...
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Ok, I'm done now.
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That might actually be a ram.
I just pity the staff all losing their jobs.
3 times I've worked for companies who've either gone bust,administration or cease trading.
They'll get redundancy but it depends how long they've been there.
No income and rents/mortgages/bills to pay is the worst possible scenario.
Lets hope they get jobs soon.
Poor buggers.
I've worked for companies who've either gone bust,administration or cease trading.
woolies and habitat here!
Very weak business model being solely dependant on one or two massive [s]customers[/s] suppliers with no long term contract in place though.....
fixed that..
As others have mentioned "crapphone whorehouse" saw the writing on the wall and jumped into bed with Dixons/PCW, accessing the telecoms marker in a different way, one that still has some life in it, Phones 4U didn't and are now done.
This happened in so many markets, over so many years. One that jumps to mind is PCs / computers - one of the reason you don't pick up a PC magazine (do they still exist?) and find hundreds of adverts from one-man-and-his-dog PC builders like you did in the early '90s is that they could no longer get hold of the latest motherboards and processors in sufficient quantity / timeliness / price to be able to compete. Intel locked down their supply channel to the big boys only, and the little guys either had to get hold of stuff "grey" or use older stuff. Or close, which they all did.
Nephew and partner both worked there, both loved it, apparently staff were rewarded well for hard work (sales) Shame they moved into a new house literally weeks ago and have just come back from Rome on holiday 🙁 Good luck to anyone on here hit by this...
I thought they missed a trick when initially people like Virgin, then Tesco etc, bought a shed load of minutes in bulk off of the big suppliers and resold them themselves - instead they continued to offer a service that got replaced by the internet.
They had a '4' in their name. They could have only surpassed this if they were called Phonez4u. On that basis alone they deserved to die.
Or maybe I'm being a little bit harsh. But then I also hate high street shopping, shopping centres and this materialist fascination with gadgets which P4U epitomises.
Someone just told me last year they had £1 billion in revenues (£100m profits), scary how a company can just sink so quickly, business case study in being over exposed.
I wonder if they can just re-brand as a massive franchise for one of the mobile providers, it would seem they have store locations and trained staff ready to go.
Not great for local rental markets, lost of empty shops and lost business rate income too for local authorities.
Bought for £600m in borrrowed cash, £200m profits in the last couple of years whilst not building a sustainable business. Bust now, staff lose out, investor pensions funds lose out, buyers lose out on choice, champers for the equity partner.
ta daaa!
they haven't gone "bust" as such, just been put in administration as they can no longer supply mobile phone contracts.
"A good company making profits of over £100m, employing thousands of decent people has been forced into administration," he added.
I wonder if they can just re-brand as a massive franchise for one of the mobile providers
Vodafones4U?
Oh, wait...
I doubt if a rebrand as a franchise is possible. There are two EE stores in my small town, hangovers from when Orange and T-mobile were seperate entities. Once the leases expire in similar circumstances there will no doubt be further contraction from the high street to online.
The move to 24 month contracts must have hurt them too
That's becoming more prevalent though, throughout the industry.
As others have mentioned "crapphone whorehouse" saw the writing on the wall and jumped into bed with Dixons/PCW, accessing the telecoms marker in a different way, one that still has some life in it, Phones 4U didn't and are now done.
CPW was always a retail business. Just think of the BestBuy deal. Might not have worked out in the UK, but it still netted £850m profit when the CPW share was sold back to BestBuy in the US. There's a reason why Dunstone has so many millionaires working for him....
Dixons have struggled in their market - look at the other big box stores - and so between them becoming the dominant face of gadget retial is key. As much as the MNOs hate Dunstone, they know he has the pocket of an awful lot of customers.
But P4U was adrift after the sale of Caudwell Communications - its spent nearly 10 years in various private equity hands and the business model hasn;t moved forward enough in the face of MNOs desperately trying to protect their margins in the face the pace of data usage and the network investment required. Just like BT, they don't like the market eating their lunch....
I thought they missed a trick when initially people like Virgin, then Tesco etc, bought a shed load of minutes in bulk off of the big suppliers and resold them themselves - instead they continued to offer a service that got replaced by the internet.
They did, but Tesco (like TalkTalk, Virgin, GiffGaff, Lyca etc) is an MVNO and has a different business model. No MNO would ever have let a distribution channel become and MVNO and compete with them directly. The minute they tried to do that, it would have been game over anyway. And, unlike the others, P4U didn't have any customers of its own - it just connected people to become customers of the MNOs.
they haven't gone "bust" as such, just been put in administration as they can no longer supply mobile phone contracts.
@Klunk IMO they are most definitely bust. £600m of debt and when the contracts run out next year no revenue to pay the debt, hence they have gone into administration. I would expect they have pretty much zero assets. They are foo-bared.
Chippenham has (had) a P4U, CPW, Three, EE, O2, Vodaphone, a Tesco, and some other third-party phone dealer, all within two or three minutes walk of each other.
Sadly inevitable that Darwinism is going to start culling the weaker ones.
Had they not been loaded up with so much debt, they could have kept trading.....
What would they be trading? Virgin mobile contracts & phone cases?