Harvey Norman has shut down its office stationery supply chain, OFIS, less than 12 months after its launch.
Harvey COO, John Slack-Smith, said the financial performance of the stores did not meet expectations.
“And we don’t expect them to meet our expectations during the course of 2009 due to the current economic conditions we’re all faced with,” he said. “The business model itself has not proven sustainable in the economic environment.”
The five OFIS stores will cease trading over the coming months and represent a pre-tax profit hit of $7- $8 million.
Slack-Smith said it was in the process of putting together a closing down sale.
OFIS had 120 employees across the business. Slack-Smith said it was working with the organisation’s management and looking to relocate as many staff possible across the Harvey Norman, Domayne or Joyce Mayne divisions.
“It’s our intention to minimise the amount of people this decision is going to have an impact on,” he said.
OFIS had four main categories: Stationery, computers, furniture and print services. Key printer and notebook brands included Epson, Lexmark, HP, Apple, Toshiba, Canon, Brother and Konica Minolta.
The first OFIS stores were located in Albury and Auburn, NSW, and opened in March 2008. At the time, OFIS general manager, Paul English said its goal was to have 100 stores nationwide.
Other store locations included: Maitland in NSW; Cambridge Park, Tasmania; and Mentone, Victoria.