After announcing its closure of 363 stores in February, Dick Smith’s receivers Ferrier Hodgson has confirmed it will consider the debts owed to print giants, PMP and Wellcom Group after the electronics retailer winds up its business. During its February financial results announcement, both Wellcom Group and PMP stated debts owed by the doomed retailer were hindering the companies’ revenue streams. Ferrier Hodgson spokesperson, Matt Francis informs Australian Printer that both PMP and Wellcom Group have been considered ‘unsecured creditors’ of Dick Smith.
Dick Smith: debts owed to printers will be addressed
Francis confirms the debts owed will be addressed. He says, “Their claims for payment will be considered in the normal course of events as the Dick Smith business is wound up and the claims of secured creditors and other ranked creditors are dealt with from the proceeds.” Online electronics retailer Kogan.com recently announced that it plans to somewhat resurrect Dick Smith after purchasing its online domain. A statement issued by Kogan.com CEO Ruslan Kogan says, “Dick Smith is an iconic Australian brand and we’re thrilled to be able to keep it alive, as well as Aussie owned and run. We will invest in building and nurturing the Dick Smith community, and honour the great legacy of this Australian business. “I remember as a kid always visiting Dick Smith to look for parts to upgrade my computer. There is a strong history of passion in the Dick Smith community for how technology can improve our lives, and we look forward to helping make it more affordable and accessible for all.” Francis says the deal with Kogan.com is part of the ongoing liquidation process. He adds, “As mentioned, there is also a controlled store closure programme underway and stock realisation sale ongoing. This was announced in late February and is likely to run for several weeks although individual store closure dates will vary.” Financial pundits have pointed to a number of causes for the company’s downfall, with some suggesting Dick Smith’s woes began back in 2012 when it was owned by Anchorage Capital Partners. They report the company was intensely focused on profit margins during this period, despite it being the lowest margin electronics retailer in the Australian market. Some suggest the actions of Dick Smith’s executive management, including their decision to reduce its store’s floor space and introduce a private label strategy for its products, also compounded floundering profits which led to its demise.
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