Dick Smith Is Officially Closing All Of Its Stores

At the beginning of this year Dick Smith went into voluntary administration. Today its receivers have announced that all 363 stores across Australia and New Zealand will be closed over the next eight weeks.

2890 staff members will be affected by the closures.

According to the receiver James Stewart, offers received simply weren't high enough.

“While we received a significant number of expressions of interest from local and overseas parties, unfortunately the sale process has not resulted in any acceptable offers for the group as a whole or for Australia or New Zealand as standalone businesses,"he said. "The offers were either significantly below liquidation values or highly conditional or both.

“We would particularly like to thank the Dick Smith employees for their support and patience during the receivership process.”

According to recent reports, Dick Smith owes 3200 employees $2 million in unpaid wages. According to the receivers, these staff members will rank as priority creditors and are expected to be paid in full.

Update: Dick Smith will be holding a fire sale of remaining stock in all stores, to begin Friday 26 February — tomorrow. Head to Lifehacker for more details.


Comments

    Last thing i got from there was a pair of Logitech G430s if i want gaming stuff i would now go to eb games or jb hifi.

      gaming stuff from eb or jbhifi..?
      unless you love ridiculous mark ups and wasting your money - go to MSY or PC Case Gear or even online.

      markups for PC gaming peripherals are a joke at major retailers; console stuff aren't as bad but i'd still avoid EB like the plague.

        I dont hate JB Hifi or EB Games i always shop at both and i do shop at PC stores if and when i can like MSY/PLE/Austin Computers.

    I dont think ive ever had a good experience shopping there. They're staff seemed to always be either very rude, sleazy, or condescending...

      Seconded. The last 10 years have been horrible.

        Thirded. walked into a store where 3 people are at the counter with no customers. I grab mouse and waited 5 minutes before one finally said "next" when I was the only one there. I told them I was good, dropped the mouse into one of their specials bins and walked out

          yep, Dick smith service was disgusting. The wait times.... yerrrgrrraahhh

          you waited an entire 5 minutes just standing there, instead of walking to the counter?
          lol okay no worries mate

            Bang on! Ha ha I thought the exact same thing...

            I've waited at the counter before and they've ignored me. Pretty sure this is what was happening here. They were all yacking and not doing their jobs.

            I forgot to mention I was waiting at the counter, the 3 of them ignored me completely even when I said "excuse me"

    That's odd, the store in my area has a job ad in their windows. Why would they advertise when they're closing down?

      The staff probably got very little or no advanced warning ahead of the public press release. That being the case, the store management probably didn't know they would be shut down and were looking to hire since it was still business as usual.

      Last edited 25/02/16 8:15 pm

        This. As it's a publicly listed company, that sort of information is held very tightly until a public statement is made for the market.

      It only came out today. It seems that the higher ups have been bullshitting the store staff up until the call today.

      A close friend of mine accepted a Store manager position litterally a week before they entered receivership, even as a manager, he only learned of the stores closing through media channels recently, nothing filtered down through official internal channels.
      A lot of the decision making ect has been kept very quiet and I find it weird the receiver's statement thanks the staff for their "support and patience" when they've not even been aware of what's happening haha.

      Last edited 25/02/16 9:18 pm

    I wonder what happens with the lifetime warranties given to things like surge protectors...

      Is it a dick smith warranty or manufacturer warranty?

        I have a bunch of DSE surge protectors, each of which by default comes with a $100k lifetime warranty (*edit* or something like that) if they fail to protect plugged in devices. Nothing unusual, I just picked them up at various times when on sale.

        So DSE brand, which I am assuming means DSE responsibility. So is that a store or manufacturer warranty, and does it make a difference?

        I never looked at the fine details closely, and to be honest I dont really care one way or the other. This is just mild curiosity about where the punter now stands with DSE branded stuff more than anything. We wont be able to go back to the store of purchase.

        Last edited 25/02/16 4:05 pm

          Yeah you're probably outa luck there with DSE branded stuff.

          I know a guy who *used* to work there.
          In his words: "You're shit outa luck'"

          DSE are the importer and distributor. Doesn't matter who makes their stuff overseas, they have zero responsibility.

    Wait, 2890 staff are affected by the closures but 3200 employees are owed money? Is the second number including people in head offices maybe? Either way I'm surprised that staff are being treated as priority creditors since the two times I've been involved in involuntary administration processes the staff were the last to be credited and the only reason we got our entitlements was because of GEERS. Hopefully those affected land on their feet.

      I'd say that number is including people who quit because they weren't getting paid.

      Pretty sure they've already closed a few, or that there have been a number that have left with monies owing.

      Quite likely 300+ staff have already left.

      In a voluntary administration, as I recall, payment goes to the following:
      (1) Preferred creditors (including debts incurred by the liquidator)
      (2) Employee entitlements
      (3) Non-preferred creditors (which is most of them)
      (4) Equity holders (usually get nothing).

      Not sure if this differs for involuntary administration. Gift cards and such are regarded as falling under non-preferred creditors.

      I was working for a company during the Internet bubble back around 2000 and when it wound up all employees received full entitlements but the creditors received something like 3c in the dollar.

      I overheard one of the company directors at the time say that this was more-or-less deliberate. It was a pretty nasty way to treat the creditors, but as the major creditor was Telstra there wasn't really a lot of sympathy to go around.

      Sometimes I wonder how ASIC might have responded if they had access to that conversation.

      That 3,200 would include staff who aren't there any more, including Christmas seasonal staff.

    I wonder if their upper management is waiting on pay owed to them...I'm guessing not.

    It's worth noting the private equity group that initially floated Dick Smith a few years ago walked away with 4 times their initial investment at the cost of shareholders. Interesting read if you ever wonder how your average person can get ripped off and the law is unable to account for it.

    Last edited 25/02/16 4:09 pm

      Didn't they walk in, do a bunch of insane sales with no intent of using that money to restock, then walk away again?

        That's exactly what they did. It's how equity groups like that make so much money. you can pump and dump and the after-effects get blamed on the new management instead.

        Also depreciated vasts amount of inventory but carried the losses in a separate company so it didn't hit the profit margins for float.

      I just read an article that said their actual cash investment may have been as little as 10 million upfront, so they walked away with closer to 50 times the initial investment. According to the article around 100 million plus of their initial investment was actually raised through the sale of DSE stock after they took over. If that's accurate, that's quite incredible.

      https://foragerfunds.com/bristlemouth/dick-smith-is-the-greatest-private-equity-heist-of-all-time/

      Last edited 25/02/16 8:21 pm

    That's what they get for not giving me a refund for the broken antenna I bought from them 7 years ago.

    Last edited 25/02/16 3:34 pm

    It's unfortunate as this no doubt reduces competition in the consumer electronics market. I didn't shop there very often but I don't remember having a bad experience when I did.

    They were also one of only a few retailers that officially stocked Kindles, so if you're in the market for one your options are now more limited.

    I am poised like a cat watching a bird for a good liquidation sale

    So when's the big sale happening? Will it top the one a couple of years ago full of good $5-10 games?

      They've had 3-4 big sales to get rid of stuff in the last 2 years already. Usually with the best deals being pocketed by the staff, mind you.

        I've been watching these 'sales' and looking for bargains, but everything they put on sale isn't really that good of a price :(

          I've seen stuff in their "80% off" sale going for about 5% less than from Newegg, especially for cabling. Might be worth trying to pick up a Kindle cheap, though.

        I don't blame the staff for doing so...I'd get whatever I could out of a company that isn't paying me.

      Its more likely that they'll sell off the stock to another retailer.

        Look out for stuff appearing on Catch of the Day, Gray's Online, Reject Shop, etc.

    As soon as the company went into Voluntary Admin, I would have been looking for another job. That same day.

    I guess Dick's big packages finally got licked

    Lost my job after 13 years. People being excited about a closing down sale is quite disgusting.

      Whilst it sucks that you lost your job (and I mean that sincerley), the people looking forward to this sale are the ones that are going to buying stuff with money that will be used to pay off what the employees are owed.

    This news fills me with bittersweet feelings as I worked for DSE for just 4 years from 2000 to 2003, back when the store focused primarily on electronics and wasn't a JB Hifi/Goodguys style store. I still recall great times and consider it one of the best jobs I had in my life. When I worked at the Carindale/Capalaba/Stones Corner and Brisbane City stores during that time period we did have KPI's, but we always made sure customer service came first, and 'extended warranties' weren't a priority, ever, just an extra 20-30 in the hand once a month if you ever sold one from memory.

    I met some great friends who I continue to know 15 years later and had the fortune to work under of the best managers to be employed by DSE in my opinion, a man who I still call my friend to this very day. I'll always have great memories of wonderful people such as an old assistant manager from Carindale DSE who unfortunately passed away around 2001 while I worked there, this great man was just shy of 30 when he passed, I was 25 and he saw my terrible attitude. He took it upon himself to change my attitude, to mentor me and change how I treated people, this impacted my life in no small way. I carry these lessons with me to this very day, so thank you for that Jason, I still miss you mate, I'll never forget you.

    I haven't liked the company the last decade, I've seen the shoddy advertising campaigns relying on double entendres and crude humor, controversial 'sales' and occasionally outright lies. I've watched the stores turn into shoddy knockoffs of JB Hifi and Goodguys, seen staff training be almost non-existant and customer service quality in newer employees be all but absent. I've listened to friends who still worked for the company complain about it's direction, and watched most of them leave, one by one as they realised it was no longer the company they knew. That my just be my old employee standards speaking, but when I've walked into a store at times, it's rubbed me the wrong way, letting me know for a while that the store I once knew wasn't quite gone, but that this was inevitable and that this result was a long time coming.

    So goodbye to a former Australian institution, thanks for everything the company brought into my life and it's a pity the company couldn't go out being the store I remember, but at least I got to work for it while it was in it's prime.

    Last edited 25/02/16 5:37 pm

      @weresmurf I can't agree more. I worked at Carindale many years later and saw the state of the company progressively get worse. From a customer service emphasis to one where you do whatever it take to make KPIs, even unethical and lying on to customers. In many ways I am relieved to see them gone. Many times I have visited stores to see poor customer service and even outright lies. I remember older staff speak highly of Jason many years later so he must have been a great human and leader. I wish I had met him. RIP DSE :-(

      Damn that was genuinely touching! I'm just about to quit my job of 9 years, a lot of good times but the company is on the slide down and does not learn at all, and was time for me to man up and rebuild the confidence it had slowly stripped from me over the years. But like you said, I met a lot of great people and hopefully life long friends, plus I like to think it actually moulded me into something that almost resembles a man.
      Your words rang true to me good sir

    I agree with Spizza. You could have easily went up to the counter yourself instead you decided to be childish. That being said, as a Dick Smith employee myself, the staff members you had must have been poorly trained as its customary for us to greet every customer who walks into the store.

    For those who haven't already read:

    https://foragerfunds.com/bristlemouth/dick-smith-is-the-greatest-private-equity-heist-of-all-time/

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