Harvey Norman is struggling, company chairman Gerry Harvey has claimed with a 30% fall in TV values identified as a major contributor to the groups problems.
As a result the company that is also facing problems in Ireland has warned that profits are set to fall.
Speaking at yesterday’s Annual General Meeting, Harvey said that things were “not looking good” and that price deflation on flat-screen televisions and growing competition from online rivals had made it impossible to make profits on this key product line.
Earlier in the day the Thorn Group pulled the plug on their Big Brown Box online operation which were set up to sell appliances and consumer electronics goods. Despite $19 million in profits from operations like Radio Rentals and Rentlo the group was unable to turn a profit with the Big Brown Box web site.
Gerry Harvey said: “We are having a dreadful period at the moment. Australia has actually demolished the pricing of this product (TVs) more than any other country in the world. The prices we are selling them at are absolutely impossible to make any money and we have demolished the price.
“The manufacturers are losing a fortune, we are losing a fortune and the category that everyone is in — flat-screen TVs in Australia — is severely damaged.
“You are going to see a pretty sizeable fall in profit for the six months that we are in now and I don’t know how that is going to go in the next year,” he said.
He added: “We’re now looking at November sales figures and they are nowhere where I had hoped they would be. There is a big consumer lack of confidence.”