Dick Smith Electronics

[Syndrome]

It appears this company is on the ropes about to go the way of the Dodo. For older members of AFF, here is a walk down memory lane

[Rockape]

I think the writing was on the wall when they turned into another Harvey Norman.

[MITCHAY]

The staff are going to cop an absolute hammering from ****ed off customers. If they don't pay up on gift cards and orders they may as well shut up now because they won't be getting more customers.

[zoomie]

Well i guess the brand was sold out to woolworths in 1982 (i think) and probably milked for all it had over there years including writting down of stock just recently to make profits appear better to shareholders etc

My local DSE store has always been abit lacklustre with stock etc and nearly always never has what i need.

[sneaky]

i've done $300 with a gift card/refund that I have been waiting to use for a few months.

I called 2 stores today, first said it would be ok to use in a few days time, second said depending on who buys the brand and what they do the gift card could be valid in a few weeks..

but i'm guessing i have lost the cash, at least i haven't lost my job

[EASYBOSS]

Toast as of noon today

[99AUXR]

I hate dick smith like with a passion. Been into so many stores for many reason buying stuff over the years a few warranty claims etc and they are the worst with customer service I have ever seen In my life. One warranty claim I ended up getting a lesser laptop back .

[Syndrome]

Originally Posted by Rockape

I think the writing was on the wall when they turned into another Harvey Norman.

Exactly. They took over a successful business model then entered it an already crowded market. Jaycar these days are what Dick Smith Electronics used to be.

[FairmontGS]

If I was the receivers I'd be looking at the private equity sharks who stripped it, pumped it and dumped it.

[Ben73]

My brother bought a Dick Smith branded TV last year and it's the worst TV anyone in our family has ever owned. Buttons falling off after less than a month. Control stopped working after about a week. Guess he won't be getting a refund or replacement now.

[Sox]

I like the little Dicky store near me, it's damn handy.
The staff have always been helpful and what I've bought from them has worked well.
The folks bought a DSE branded 50" screen a couple years back and it's been fantastic for the money.

I think it's a big loss.

[Adamz Ghia]

Having been through receivership myself as a manager, I'm willing to bet several people have become very rich off of all this. For starters Dick Smith was sold by Woolworths for circa $94 million, and 18 months later was floated for circa $500 million. That in itself is shady and it's a wonder it wasn't investigated. The company was stripped of most of its inventory upon being bought and they didn't have the resources to buy new inventory so had to go into debt. Why was this done and who authorised it? Dick Smith was underperforming under Woolworths management and the new owners did nothing to try and reposition the brand, merely continuing on with the status quo.

This is just based on my own experience with private equity, but from where I stand Dick Smith has been used as a cash cow for a select few and I will be massively surprised if it goes under there isn't an investigation into the goings on over the last few years.

Sad thing for my brother is just yesterday he was offered a full time position within the company. He's job is up in the air now along with plenty of others through no fault of their own.

[XG_Falcon]

They tried to rip me off on a shipment of Samsung monitors last year. Had to get Paypal involved to get my refund.

I won't be sad to see them go.

[Yellow_Festiva]

Originally Posted by Adamz Ghia

Having been through receivership myself as a manager, I'm willing to bet several people have become very rich off of all this. For starters Dick Smith was sold by Woolworths for circa $94 million, and 18 months later was floated for circa $500 million. That in itself is shady and it's a wonder it wasn't investigated. The company was stripped of most of its inventory upon being bought and they didn't have the resources to buy new inventory so had to go into debt. Why was this done and who authorised it? Dick Smith was underperforming under Woolworths management and the new owners did nothing to try and reposition the brand, merely continuing on with the status quo.

This is just based on my own experience with private equity, but from where I stand Dick Smith has been used as a cash cow for a select few and I will be massively surprised if it goes under there isn't an investigation into the goings on over the last few years.

Sad thing for my brother is just yesterday he was offered a full time position within the company. He's job is up in the air now along with plenty of others through no fault of their own.

Yes, something is very wrong with the figures being thrown around...

With your brother being offered a position, why would they be hiring if upper management knew things were so bad??? You would think they should be trying to reduce their workforce not increase it?

[vztrt]

Originally Posted by tempted

Agreed. I think Dick Smith lost the plot when they got rid of all the hobby stuff / electronic components.
I wandered into a Dick Smith store a few days ago and noticed they are now selling small kitchen appliances like blenders, kettles and toasters....wtf?

Even when they had the hobby stuff it was pretty basic stuff (the staff were also very clueless on the basics). Maybe when mr true blue dick was selling mainly imported stuff was running it the joint was more hobby stuff, but Jaycar has been killing them in that area since they opened.....also the staff will more then likely know what happening.

[Adamz Ghia]

Originally Posted by Yellow_Festiva

Yes, something is very wrong with the figures being thrown around...

With your brother being offered a position, why would they be hiring if upper management knew things were so bad??? You would think they should be trying to reduce their workforce not increase it?

With my company it was the regional managers who did the hiring, and they were told as much as we were with regards to what was happening with the company. So they're told nothing is wrong and to continue to operate as normal so if a store needs a full time employee they go and hire one. I guess if a company is going bad senior management would want to keep it pretty close to their chest.

The day I found out my job was at risk my regional called me to let me know, he'd found out that morning and 5 minutes after calling me it was on the radio, there would have been managers in other locations who would have found out over the news rather than from the company itself and I would assume the same would have happened with Dick Smith today.

The real hard part is the uncertainty. What happens is the administrators will look over every store and decide if it's a viable part of the business. If it isn't they will simply walk into the store at any time of the day and either conduct a staged closing down process, often via a sale, close it down at close of business or worst case, close it down then and there, you have 5 minutes to collect your belongings, hand back keys and leave the premises. The last option happened to several of our locations, I had managers calling me in tears.

Some employees are just kids earning pocket money, but for many this is their livelihood and I really feel for them.

[bobthebilda]

People need to be aware of some the "shakey" retailers out there. Its odd that in order to take a $500 deposit from someone (ala Banks), you need to be regulated by a few authorities, but you can take a $500 deposit from someone (ie a gift card) if you are a retailer that is about to go bust. Theres a retailer listed on the stock market for about $2 billion dollars, but if you look at its financials, its net assets are in the minus $, if you take away intangible assets (brand name etc), and even tho it turns over $2 billion a year, at its last financial results, it had only $13 million in the bank. They can often trade on like this if things remain good, but hit a bad patch, and the banks are going to make sure they get their money before you get to redeem your gift voucher.

[Whitey-AMG]

Originally Posted by FairmontGS

If I was the receivers I'd be looking at the private equity sharks who stripped it, pumped it and dumped it.

Anchorage capital.
It's what they do.
Buy company
Write down inventory values
Have big sales to show big profits against reduced inventory values
No commitment on new inventory to keep expenditure low.
Open a couple of new stores to show proof of growth.
Sell out or float stock before next annual report.....

Nekminit..... Over 3000 staff on the dung heap.

Receivers will make more money on making the documentary about this than trying to recoup losses on capital etc. DS is basically worthless now. Sad.

[SYZ]

I bought a Dick Smith branded MP3 player. When the Li-ion soft cell battery gave up the ghost, they couldn't sell me a replacement to solder in, and told me the only option was to bin the player. So much for customer service.

[carwant.com.au]

Problem with the DSE brand is no one knows what they are (including their 'strategic' managers).

Why would you go to a DSE store?
Hobby electronics = Jaycar
Televisions = JB HiFi
Other electronics = Harvey Norman

Many marketers and strategic managers keep trying to reinvent the brand, as if something is wrong with it, and then bugger it up.

McDonald's is facing the same thing. We were always aware Maccas were fast (junk) food, but we still went in and bought our Big Mac meal. Nowadays, Maccas have diversified so much that they've forgotten about all their core values and what made them successful in the first place. Even their latest marketing campaign is all about being 'UnMacdonalds'.....

They can save DSE, but they need to either go back to their core business, or focus completely on a new (narrow) model and stick to that.

[mechanic]

Two things about DSE
Loud obnoxious music and ignorant arrogant staff who have no interest in customers whatsoever.
Good Guys for TV's etc, Jaycar for everything else.
Won't deal with Hardly Normal after his greedy tantrums over the GST on online purchases. His after sales service is appalling here in Cairns from all reports anyway.
Online shopping is really exposing the shonks in the Australian business community and not before time.
Just like Australia Post really.

[Yellow_Festiva]

There is someone spruiking an App that will exchange DSE gift vouchers for another shops vouchers. Don't know why they are not accepting their own vouchers if they are still trading?? It is just a deferred payment....

Anyone who has made a purchase using a gift card should take it back saying it's faulty and getting a cash refund.. I hate this sort of corporate BS where the little guy gets done over like this.

[Adamz Ghia]

Originally Posted by Yellow_Festiva

There is someone spruiking an App that will exchange DSE gift vouchers for another shops vouchers. Don't know why they are not accepting their own vouchers if they are still trading?? It is just a deferred payment....

Anyone who has made a purchase using a gift card should take it back saying it's faulty and getting a cash refund.. I hate this sort of corporate BS where the little guy gets done over like this.

I don't believe they have to refund you under administration. They just send you to the manufacturer. I could be wrong but I'm reasonably sure that's what happens.

[Blue Roo]

I would like to know who were the greedy bankers. That bought the Dick Smith Franchise off Woolworths. And ran it into the ground.

[b0son]

Originally Posted by Blue Roo

I would like to know who were the greedy bankers.

The greedy bankers in this case were NAB and HSBC, who waited until consumers had spent a small fortune on gift cards for xmas, then called in the administrators knowing fully well that was as cashed up as DS was going to be.

[Feathers]

I just had a browse through their website to see if anything interested me. Everything I clicked on had an icon, "Online Only", but directly under it text said "Instore only".
That's ok. I didn't need anything anyway.

[Adamz Ghia]

Originally Posted by b0son

The greedy bankers in this case were NAB and HSBC, who waited until consumers had spent a small fortune on gift cards for xmas, then called in the administrators knowing fully well that was as cashed up as DS was going to be.

The banks aren't being greedy at all, they just want their money back. The real culprits are Anchorage who have a history of pumping a company up for sale only for that company to hit trouble later. That's what private equity groups do.

[Spammy]

Originally Posted by FairmontGS

If I was the receivers I'd be looking at the private equity sharks who stripped it, pumped it and dumped it.

The private equity group sold it (to the shareholders) 2 years ago....it nothing to do with them. The recievers will firstly try to recover money for the secured lenders (the banks) and secondly look at the actions of the directors to see if they were trading whilst insolvent. Don't expect miracles.

[Adamz Ghia]

Originally Posted by Spammy

The private equity group sold it (to the shareholders) 2 years ago....it nothing to do with them. The recievers will firstly try to recover money for the secured lenders (the banks) and secondly look at the actions of the directors to see if they were trading whilst insolvent. Don't expect miracles.

It's has quite a bit to do with Anchorage. The way DSE has been managed since the buyout is fishy and needs to be investigated.

[Spammy]

Originally Posted by Adamz Ghia

It's has quite a bit to do with Anchorage. The way DSE has been managed since the buyout is fishy and needs to be investigated.

Don't disagree that the behaviour of achorage was less than best practice but if you think the recievers will be investigating that part of the story, then prepare to be disappointed.