Australia's landscape of retailers with their toe in the world of video games and electronics is beginning to shrink a fraction today, with reports coming out that Dick Smith has entered voluntary administration and a trading halt.
Business Insider reported this morning that bankers for the retailer, which launched a mammoth firesale weeks before Christmas, appointed Ferrier Hodgson to be Dick Smith's receiver. Advisers and insolvency specialists McGrathNicol were also supposedly appointed as administrators.
The savage discounting over Christmas was supposed to help Dick Smith through the holidays and help clear an excess of stock, but the retailer's chairman, Rob Murray, said sales were fewer than necessary. "The directors formed the view that any success in obtaining alternative funding would not have been sufficiently timely to support short-term funding requirements and allow the company to order required inventory during the next four to six weeks."
The Australian noted that Dick Smith's firesale resulted in the company issuing $60 million in writedowns. Dick Smith is currently running a one day online sale with various coupons, but the terms and conditions state that consoles, software, accessories, Xbox Live, PlayStation Network cards, laptops, and App Store gift cards are excluded.