DSGi Verdict

Verdict Research is probably the leading firm of retail analysts in the UK, publishing numerous studies throughout the year. Verdict also produces a weekly synopsis of retail news and opinion called Retail FreeView. This week's edition includes a story centred on DSG's results which were published last week.

Verdict says that DSGi's response to continuing declines in revenues is to: "Focus on its longer-term viability by offering better service, overhauling its store portfolio, growing online sales and reducing costs". But, Verdict says that in spite of these actions, it believes that: "The Group's future looks bleak".

For PC World, Verdict explains that the company is placing more emphasis on: "Service, connectivity, delivery, installation and repair, as well as on educating its customers about converging technology". In addition, Verdict says that the Group is offering: "More technical and after sales services, such as its TechGuys proposition, and placing more emphasis on sales of subscription products, warranties and guarantees which accompany the product".

None of this is really new. For some years now, DSGi has been trying to position itself as a specialist provider, but the world has moved on. In so many ways, DSGi's competitors - be they the major grocers, other players with simpler propositions [especially John Lewis in the UK], and the pure play online retailers - offer what the consumer wants, in a format they understand, and at a price point [and margin] which is does not need to be propped up with accessories and service add-ons.

Verdict concludes its analysis by saying that: "If the retailer does not not take more decisive, aggressive and appropriate action now, it risks slipping into terminal decline, with a confused, irrelevant offer, a forever shrinking store portfolio, and customers flocking to its rivals". Ouch!