In particular, he noted that homeowners who are seeking to remortgage – which they do on average every four years – will find mortgage costs are 30 per cent higher than when they last agreed a loan.
60 per cent of the mobile phone retailer's profit now comes from recurring revenue streams, so Dunstone said that Carphone Warehouse is not as reliant on people coming into stores as other retailers. He said: “Having 5 million people a month paying us by direct debit is a good place to be.”
Dunstone's advice to his peers to survive the emerging downturn is to avoid short-terms gains, re-examine their costs and business processes and simplify their business.
In addition, he said it is crucial to be a better partner to your suppliers, because they will focus less of their resources on a retailer that is trying to squeeze them when times are tough for everyone.
On the upside, Dunstone believes that a trading downturn also creates opportunities for retailers with a sound business model: good shop sites come up, it is easier to recruit and retain great staff and it is the perfect time to turn the screws on the competition.
Dunstone said that, having set up the business in October 1989 during the last major downturn in the UK economy, the heritage of the company is “doing business in tough times”.
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