Cost-cutting exercise follows record breaking half year profits of £1.8 million for B2B telecoms provider
A1 Comms has terminated eight “underperforming” Go Mobile stores and is closing its Daventry office following a financial review of the business.
B2B telecom provider A1, the parent company of Go Mobile (acquired from Shebang in 2012) and Buymobilephones.net, made the decision last month, despite having recently achieved record half year profits of £1.8 million across the group.
Store closures include those in Mutley Plain, Paignton, Plympton, Plymstock and Torquay in Devon, St. Austell and Truro in Cornwall, Banbury and Oxfordshire.
It takes the number of Go Mobile stores from 78 to 70, of which 41 are franchise-owned.
Unprofitable stores closed
“If you have some stores that are unprofitable, then it doesn’t make sense to continue running them,” said A1 Comms founder and CEO Paul Sisson, who also revealed the firm is also closing the Go Mobile head office in Daventry, Northamptonshire.
Sisson explained the office, inherited from its acquisition from Shebang, was an unnecessary drain on resources, and will now be integrated, including all 12 staff, into its group head office in Alfreton, Derbyshire.
“We are always looking to be more efficient and running the office in Daventry just wasn’t economical,” said Sisson. “We have done a bit of cost-cutting and are a more efficient business than we were 12 months ago.”
He added: “We have lots of space in Alfreton and are in the process of relocating operations from Daventry.”
Stuart Joce departure
Sisson also revealed he has now taken on the daily running of A1 following the departure of managing director Stuart Joce last month.
Joce left the firm to take up a senior role at Caribbean mobile operator Digicel.
Sisson claimed that the demise of competitors Phones 4u and its e-commerce business Dial-a-Phone last September had boosted its sales and profitability.
A1 Comms made a profit of £1.8 million in the six months from October 1, 2014 to March 31, 2015 – a record high in the company’s 17 year history. This compares to profits of £2.3 million made in the entire 2013/14 financial year.
“The big turning point was the demise of Phones 4u, which saw us lose two major competitors in Phones 4u and Dial-a-Phone, which directed many more customers our way,” he said.
“We had improved iPhone 6 and 6 Plus stock levels and received the devices in October rather then, as in some cases up until December. Their release created consumer demand that wasn’t there in the previous six months.”