CE Industry Set To Benefit From Qld Floods As Insurers Pay Out Billions

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There is good news and bad news for Australia’s consumer electronics industry following the devastating Queensland floods. In the short term retailers and service providers are set to be hit hard due to store closures and in some cases total destruction of buildings and infrastructure.

But as the clean-up begins and insurance Companies start to pay out billions in compensation, retailers vendors and distributors will benefit from consumers purchasing new TV’s home phone systems,  appliances and home entertainment and PC systems says the Insurance Council of Australia.

Meanwhile  IT Companies are set to reap the benefits as  thousands of businesses buy new IT gear and services. 

 The Insurance Council of Australia has said that insurance companies would pay out on claims according to the terms and conditions of policies and for those who have purchased the right level of content insurance they will “very quickly” get paid out an ICA spokesperson said.

“If people did not purchase flood cover insurance, they will not be covered,” they added.

Dick Smith, Harvey Norman who also trades in Queensland as Clive Peeters, JB Hi Fi as well as WoW Sight and Sound have all been hit by the floods. In Toowoomba both the Harvey Norman and Wow Sight and Sound stores have been affected by the floods.

Only days ago Harvey Norman manager in Toowoomba Rob Purcell was doing record business selling cameras, games and dryers.

It was the same at the Toowoomba Wow Sight and Sound’s store.


Coles Before Flood: Click to enlarge
Picture Credit: NEWS LTD & Courier Mail

JB Hi-Fi has closed 12 out of 32 shops, more than one third of its total store count in the Queensland area, while between 20-30 Dick Smith stores have shut down, bringing trading activity to a total halt due to a combination of “flooding, shut down of the power-supply and staff shortages,” according to a Dick Smith spokesperson.

A JB Hi-Fi spokesperson said its Ipswich store is still in danger of further damage by rising floodwaters but they hope to re-open others by the weekend, they said in a statement.

Workers are being forced to leave their workplace and salvage what is left of their devastated homes.

The affected Dick Smith stores are mostly in the Ipswich and Brisbane areas, and there have been no other regional closures, a company spokesman said. 

 

There have been no indications as to how many Harvey Norman stores are affected, although its Chairman, Gerry Harvey is currently in the disaster stricken state, attending his racehorse auction, the Magic Millions, held at the Gold Coast.

Telstra, Optus and Vodafone are facing a bill in excess of $50 million to repair vital infrastructure across Queensland with several smaller ISP’s hit due to their equipment being housed in Telstra Exchanges.

In recent days thousands of consumers and business operators have been left without mobile or land line services. Yesterday Telstra said that 262 telephony exchanges used to provide essential communication services had been declared “red zones”, meaning the affected areas were currently a “no-go” for Telstra technicians tasked to repair the damage.
According to the ICA many businesses are already lodging claims for computers, servers, phone systems and office equipment with several vendors now looking to ship additional stock into Australia to meet the demand for “new gear” an OfficeWorks spokesman said.

John Parkin, Telstra’s director of service delivery, northern region, said communication services in Brisbane would be back on line within four days, but central and western Queensland were facing a wait of up to 18 days without services.

Towoomba, the Lockyer Valley and Grantham remain some of the worst affected regions where mobile and fixed telephone services remain off-line due to extreme flooding and lack of power.

The Australian newspaper reports that several mobile base stations and telephony exchanges have been powered by battery backups and diesel generators since the floods struck, but restricted access too many sites has hampered much of the recovery effort.

“We have a disaster here that spreads across the equivalent size of France and Germany together and we also have an area with a large population,” Mr Parkin said.
Both Optus and Telstra expect it will take at least three months to rebuild and repair the damage to their communications networks.

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