Telstra to ditch licensed stores model

By Dean Blake | 11 Feb 2021 View comments

Telstra announced today it plans to bring all branded retail stores under its full ownership, aiming to exit partnerships with independent licensees and Vita Group.

The telco owns and operates 67 stores, with another 166 stores owned and operated by licensees and 104 stores by Vita Group.

Negotiations with Vita Group started on Thursday, the business said, and will begin with its licensees “shortly”, and will continue over the next 12 to 18 months.

“This was not an easy decision given that we have enjoyed a long-term partnership with many of our licensees,” Telstra group executive for consumer and small business Michael Ackland said.

“As more customers interact with businesses online resulting in changes to the broader retail industry, we think now is the time to bring back full ownership to further develop a consistent and integrated customer experience across our online channel and store network.”

Telstra said it expects to maintain a large retail presence across Australia, and that in many rural communities the local Telstra store provides a range of support to businesses and locals, and will continue to do so under this change.

The change is also geared to ensure responsible business practices, and to resolve issues more clearly, through a high standard of service and a more direct employment relationship.

The announcement came as the business revealed its half-year results, which saw revenue fall 9.7 per cent to $10.9 billion, and net profit fall to $1.13 billion from $1.15 billion.

This article was first published on Inside Retail, a sibling website to Inside Franchise Business Executive.

Edit: An earlier version of this story said Telstra had partnered with Viva Group, when it is actually Vita Group. The story has been updated the reflect this.