Carphone slams Vodaphone over sales demand
Carphone Warehouse has accused mobile phone giant Vodafone of demanding a guaranteed 35,000 sales a month irrespective of the terms offered to customers, according to a report today.
Shares in Carphone plummeted last week after Vodafone announced it would drop the retailer in favour of an exclusive third party retail deal with rival Phones4U.
According to The Sunday Times, Carphone chief executive Andrew Harrison has sent an email round to store managers saying Phones4U had agreed to guarantee a large percentage of subscriptions sales every month "no matter how competitive the offer is".
"Vodafone approached us to do the same deal and we would not go anywhere near it with the terms on offer," Mr Harrison said. "It goes against everything we stand for."
On Friday, Carphone Warehouse was backed by phone operator T-Mobile, which said it saw Carphone as an important partner despite Vodafone's decision.
This came as a boost to the company following an announcement by Orange that it was reviewing its retail strategy, sparking fears it could also pull out of the chain.
Last week, was a turbulent week for Carphone, which had been in upbeat mood on Wednesday with the £370m (€548.9m) acquisition of the UK arm of AOL from Time Warner.
The deal helped calm concerns over losses incurred during the roll-out of its free broadband offer to TalkTalk customers and impressed the market as it vaulted the firm into third place in the broadband market behind BT and NTL with a customer base of two million.
However, the picture changed dramatically on Thursday following Vodafone's announcement of its exclusive deal with Phones4U.
While Carphone pointed out that less than 10% of its contract customers picked Vodafone, the news still sent the share price tumbling as analysts predicted a bleak outlook.
Orange insisted it still had a good relationship with both Carphone and Phones4U, but admitted its indirect distribution costs had gone up and that it was reviewing its strategy.
