Saturday, August 29, 2015

Electronics hot, jewelry cool for QVC

The West Chester shopping channel is seeing lower margin electronics items selling well, while higher margin jewlery remains soft.

Electronics hot, jewelry cool for QVC

0 comments

Think QVC and the image that comes to mind is likely a TV host selling some type of jewelry.

Now when you’re selling consumer goods 24 hours a day, 364 days a year, a network can’t live on jewelry alone. But it’s been a key driver of the West Chester cable shopping channel’s business for years.

That’s why it’s a little surprising to learn that electronics is QVC’s most popular business right now.

“That seems to be one of the categories that has held up better for us than other categories,” QVC CEO Michael George said during a Morgan Stanley conference call yesterday.

Unfortunately for QVC, electronics is a low-margin business, meaning it makes less profit per sale than jewelry, which is its highest-margin business. QVC doesn’t disclose what those margins are.

QVC is the engine that runs Englewood, Colo.-based Liberty Media Corp. For its nine months ended Sept. 30, QVC generated revenues of $5.7 billion, or nearly 80 percent of Liberty Media’s consolidated revenue.

Like its storefront kindred, QVC has been seeing its financial results hurt by the slide in consumer spending.

No silver linings

Among the many snapshots of the U.S. economy released yesterday, the Organization for Economic Cooperation and Development was particularly downbeat.

“The U.S. economy is facing extremely difficult conditions,” the OECD said in its semi-annual economic outlook. The report says the current environment is “the most serious recession since the early 1980s.”

And the group points the finger squarely at the financial crisis, saying that how bad things get depends on how quickly the financial crisis is overcome.

“The unfolding events since mid-2007 have highlighted the need for a major overhaul of financial regulation and supervision,” the report says.

I don’t think anyone disagrees, but we need to get beyond the daily announcements from the Treasury and Federal Reserve about new efforts to jump-start credit markets that remain stalled.

Inquirer Columnist
0 comments
We encourage respectful comments but reserve the right to delete anything that doesn't contribute to an engaging dialogue.
Help us moderate this thread by flagging comments that violate our guidelines.

Comment policy:

Philly.com comments are intended to be civil, friendly conversations. Please treat other participants with respect and in a way that you would want to be treated. You are responsible for what you say. And please, stay on topic. If you see an objectionable post, please report it to us using the "Report Abuse" option.

Please note that comments are monitored by Philly.com staff. We reserve the right at all times to remove any information or materials that are unlawful, threatening, abusive, libelous, defamatory, obscene, vulgar, pornographic, profane, indecent or otherwise objectionable. Personal attacks, especially on other participants, are not permitted. We reserve the right to permanently block any user who violates these terms and conditions.

Additionally comments that are long, have multiple paragraph breaks, include code, or include hyperlinks may not be posted.

Read 0 comments
 
comments powered by Disqus
About this blog

Mike Armstrong Inquirer Columnist
Also on Philly.com:
letter icon Newsletter