Big independent mobile phone retailers have been practically wiped from the internet in the past few years, as either bigger players have bought them out or the cashback crisis has eliminated them altogether.
Buymobilephones.net, which emerged out of the sale of the A1 Comms retail chain to Midlands rival Go Mobile in 2006, claims to be the biggest indepedent web dealer left in the UK.
It doubled turnover in 2007/8 to £12 million and is closing on £30 million for the 2009/9 financial year. Managing director Paul Sisson (pictured) remarks: “It’s not realistic to expect it to continue to grow at the same rate, but I do expect further growth.”
Sisson formed A1 Comms in 1997 and grew the business into a chain of 11 shops around Derbyshire and the East Midlands. It opened its first website in 1999 and looked to retain parity between A1 pricing in-store and online.
Ultimately, the site was failing to match the kinds of offers available from rival web operations, however. And Sisson refused to undermine punters in store by offering better deals under the same brand online.
So he set up buymobilephones.net in 2003 as a parallel provider, offering competitive online sales. By 2006, it was doing better business than the A1 retail estate.
Sisson sold to Go Mobile to focus purely on the web operation. He retained the A1 brand for business sales, but the consumer site gets 10,000 unique users each day and takes the vast majority of sales. It took its 500,000th order earlier this year.
Sisson works with Orange, T-Mobile, O2 and 3 directly. He says he is reluctant to work with distributors because margin is tight and he is unready to relinquish any to third parties. Vodafone has been reluctant to deal with buymobilephones.net directly, shrugs Sisson, adding it will keep knocking at Vodafone’s door regardless.
2007 was dealer-land’s annus horribilis. Cashback contracts got hugely negative consumer press and many dealers were exposed for operating unsustainable models in a forlorn attempt to compete with high street and network retailers.
Channel businesses went under. Some reinvented themselves as price comparison sites. Other big operations were bought out by the likes of Carphone Warehouse and Phones 4U. He suggests the introduction of revenue share by O2, Orange and T-Mobile should preclude new entrants to the market, too.
Sisson’s business thrived during the cashback collapse, and has earned a reputation for reliability and service to boot (it was commended among online retailers at the Mobile News Awards in March).
Full article in Mobile News issue 439 (May 18, 2009).
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