Carphone Warehouse 2011 Annual Report Download - page 29

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Virgin Mobile France has developed its own risk management
processes during the year, to identify the main risks facing the
business. The table below summarises the most material
risks identified and the ways in which the business seeks to
mitigate them.
BUSINESS REVIEW
BUSINESS REVIEW
VIRGIN MOBILE FRANCE: RISK
Consumer environment
Risk
Consumer confidence in France remains relatively low,
which may affect the level of customer spend and the
ability of the business to acquire new customers.
Mitigation
The business is focused on improving the quality of its
proposition through a wider product and service offering,
increased distribution channels and ongoing brand
development.
Dependence on key suppliers
Risk
The business is reliant on third parties for the provision
of its network infrastructure.
Mitigation
Virgin Mobile France has a strong relationship with its
key suppliers, and its increasing scale helps to improve
its commercial position. The business is in the process
of developing a fuller MVNO infrastructure to reduce
dependency and improve flexibility over time.
Competition
Risk
The entry of a fourth network, expected in 2012, may
make the market more competitive, and adversely
affect the business’ revenues and margins.
Mitigation
The business continues to invest in the quality of its
proposition, brand and distribution channels to try to
improve its scale and competitive position.
Operations
Risk
The business is reliant on internal and external IT
systems which could fail or be unable to keep pace
with the needs of the business.
Mitigation
A significant investment has been made over recent years
in the IT infrastructure of the business, supported by
evolving business continuity plans.
Carphone Warehouse Group plc Annual Report 2011 25