Harvey Norman boss Gerry Harvey says he may have to close some more former Rick Hart electrical stores in WA as the retail slump continues to bite.
Mr Harvey last year closed three Rick Hart stores in WA and converted the rest to the Harvey Norman brand. He said yesterday that up to five more of the stores were unprofitable.
"There's certainly some of them that are fine," he said. "The worst ones are gone but that doesn't mean there's another one, two, three that have got to go some time in the future."
"It's just a simple case if the store loses too much money there's no point."
Harvey Norman bought the Rick Hart and Clive Peeters outlets from administrators in 2010 for $55 million but was unable to turn them around.
"We should have never have taken over that business. In every State it's been proven to be the wrong decision."
Mr Harvey said new store openings and conversion from other franchises would ensure the chain's State and national store count stayed about the same.
The listed retailer yesterday released unaudited figures showing a 40 per cent plunge in net profit to $227.6 million for the year ended June 30 after sales in Australia slid 8 per cent.
Much of the blame was sheeted home to ever cheaper technology products, while home appliances, furniture and bedding remained stable. Mr Harvey said the future was looking bleak for a number of electrical retailers. "This is a shake-out of the appliance and retail industry that's occurring at the moment.
There are going to be a lot of casualties," he said. "There'll be a contraction in shop numbers I would have thought of at least 10 per cent."
These included deep cuts to the national numbers of Dick Smith and Retravision stores. He said Harvey Norman was picking up some Retravision stores in NSW and Victoria in the wake of the $30 million collapse of that electrical chain's buying group in Melbourne.
Retravision's WA arm has signed up at least 46 branded stores in those States, while Queensland-based Betta Home Living chain has claimed about 40 others have defected to its group."It would have been nice to get more but the reality is we're a long way from the eastern seaboard," Retravision Western chief executive Paul Holt said. "The damage done to Retravision's reputation over there will clearly be significant."
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