Dick Smith in store decline

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20164 posts

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#1474748 19-Jan-2016 16:24

MikeB4: Businesses can come back from receivership to be successful enterprises, DSE should be given a chance and not hit by the great knocking machine which is public opinion.

They can if they have a lot of public goodwill behind them, as being in business is a two way street. SUre, you may have products to sell, but you need people who are willing to trade with you. A good example of a successful receivership, is Whitchoulls who generated a lot of public goodwill when they decided to honour their gift vouchers by requiring you spend 50% of the purchase price in cash, even though they didn't have to. They were, and still are a NZ company though. DSE appears to be Australian owned and operated, and they aren't honouring vouchers, so the public are venting on their facebook page as a result. So the NZ public don't appear to have the same sort of goodwill towards them, as shown on their facebook page.

mattwnz

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#1474751 19-Jan-2016 16:25

mentalinc: Shame no one has updated the tv adverts...

I haven't seen any TV adverts for them since xmas. Are they still showing them?

dejadeadnz

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#1474817 19-Jan-2016 19:11

mattwnz:
MikeB4: Businesses can come back from receivership to be successful enterprises, DSE should be given a chance and not hit by the great knocking machine which is public opinion.
They can if they have a lot of public goodwill behind them, as being in business is a two way street. SUre, you may have products to sell, but you need people who are willing to trade with you. A good example of a successful receivership, is Whitchoulls who generated a lot of public goodwill when they decided to honour their gift vouchers by requiring you spend 50% of the purchase price in cash, even though they didn't have to. They were, and still are a NZ company though. DSE appears to be Australian owned and operated, and they aren't honouring vouchers, so the public are venting on their facebook page as a result. So the NZ public don't appear to have the same sort of goodwill towards them, as shown on their facebook page.

I think it's quite naïve to keep focusing on the vouchers issue as though sorting that out will go on its own go a long way to making DS rescuable. IMO, it won't. And frankly if the store has enough to offer, people not affected by the voucher debacle are unlikely to be hugely deterred by it. Just look at how people always flood to stores in receivership/liquidation running big sales.

I was at the Sylvia Park mall and walked past the DS store. What have their management done again? They moved or at least had previously placed a huge amount of private label crap next the entrance to the store -- all at massively inflated prices and clearly no one wants that stuff. Meanwhile, the rest of the store looks sparse as hell. DS right now (and this isn't just my view - it is also the view of my commercial/institutional lending colleagues at a major bank not involved in this receivership who have plenty of experience placing borrowers into receiverships) is failing to execute a coherent strategy.* If it's trying to generate cash, it's doing something that I have almost never seen in relation to any other retailer in receivership: having no substantial sales whatsoever. Yet it's also struggling to put up the front of being a viable going concern -- lots of stuff are out of stock, much of what they sell are at best second tier or even third tier brands, and it's long been clear that many top tier brands have stopped dealing with DS long before it went into receivership.

If you're going to buy electronics, tell me why you would go to DS right now even if they started honouring the vouchers (except if you are a holder of a voucher)? Whitcoulls' case isn't remotely comparable. You're perfectly safe to buy some books or toys during the receivership because you're unlikely to need any kind of after-sales support. Whitcoulls also happened to be (and continues to be) the largest chain book store in the country with all the attendant advantages attached to it for any buyer. DS is up against JB Hifi, Noel Leeming, and Harvey Norman, entities that are established, have better range, generally better prices, and are regarded as having far better parent companies/management than DS.

* I have also been involved in corporate strategy/consulting work

mattwnz

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#1474821 19-Jan-2016 19:21

dejadeadnz: Whitcoulls' case isn't remotely comparable. You're perfectly safe to buy some books or toys during the receivership because you're unlikely to need any kind of after-sales support. Whitcoulls also happened to be (and continues to be) the largest chain book store in the country with all the attendant advantages attached to it for any buyer. DS is up against JB Hifi, Noel Leeming, and Harvey Norman, entities that are established, have better range, generally better prices, and are regarded as having far better parent companies/management than DS. * I have also been involved in corporate strategy/consulting work

Whitchoulls is more than just a bookshop these days, they sell all sorts of things that may need aftersales service on. Toys, games, electric gadgets. I have in the past had to return books where the binding has cracked (cheap chinese publishing in those cases) and the books has had to be replaced or refunded. I have only had to deal with DSE after sales on once occasion, although that was a fail, and had to go to the manufacturer to get a result. Electronics on the whole are quite reliable, and most of the things like computer support are contracted out to the manufacturers support line. I think it is more likely the cheaper house branded stuff that will fail first, where there is unlikely to be the manufacturer support in NZ for. So I would suggest people who do buy from it, buy something that is supported by the manufacturer in NZ, such as Sony

dejadeadnz

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#1474853 19-Jan-2016 20:05

mattwnz: Whitchoulls is more than just a bookshop these days, they sell all sorts of things that may need aftersales service on. Toys, games, electric gadgets. I have in the past had to return books where the binding has cracked (cheap chinese publishing in those cases) and the books has had to be replaced or refunded. I have only had to deal with DSE after sales on once occasion, although that was a fail, and had to go to the manufacturer to get a result. Electronics on the whole are quite reliable, and most of the things like computer support are contracted out to the manufacturers support line. I think it is more likely the cheaper house branded stuff that will fail first, where there is unlikely to be the manufacturer support in NZ for. So I would suggest people who do buy from it, buy something that is supported by the manufacturer in NZ, such as Sony

Whitcoulls got out of electronics quite a while ago and withdrew all their ebook readers. The owners quite wisely concluded (in exercising that kind of retail/strategic wisdom that seems totally beyond DS' management and the receivers) that it wasn't a space that they wished to compete in. I think it's still reasonable to venture that your average buyer of electronics is more concerned about after-sale support than your average shopper at Whitcoulls and a lot of people are too ignorant to realise that they can go to the manufacturers directly for support or don't want to bother. Thus, unless a store is materially cheaper, I suspect many will buy from a retailer that they have confidence about being around for a while.

andrew027

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#1475118 20-Jan-2016 09:23

dejadeadnz: DS is up against JB Hifi, Noel Leeming, and Harvey Norman...

...and depending on where you live, Betta Electrical, 100% stores, specialist hifi or computer stores (e.g. The Listening Post and Youbee in Wellington), stores where TV, audio, PCs and phones are just part of a larger product range (Farmers, Smith City, The Warehouse, Warehouse Stationery, etc.), plus countless online options... For phones they are also up against the networks (Spark, Vodafone, etc.) and for smaller items like plugs, cables, chargers, there is Jaycar, etc. They are even competing with hardware stores in some areas (the last time I went into a DS store they didn't have what I wanted and I ended up finding it at Mitre10).

The only thing DS has that nobody else has is DS-branded products, which seem to be cheap quality but often without a matching cheap price.

Hiamie

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#1475159 20-Jan-2016 09:56

andrew027:

The only thing DS has that nobody else has is DS-branded products, which seem to be cheap quality but often without a matching cheap price.

And that has contributed to their downfall. When I think of Dick Smith, I think of their own in house brand products, and how crappy and awful they generally are. Having been stung in the past buying a "Disk Smith" brand product, I don't think of "Dick Smith brand" and "quality" at the same time!

Further, when they re-brand other manufacturers products, it is difficult / impossible to seek reviews on the product, get additional information, or even obtain simple things like remote control codes - unless we know what the original manufacturer brand and model is.

And other crazy things, like recently I saw a Samsung Galaxy S3 - repaired / reworked for sale at $650 with full warranty (Newmarket store). I bought my S3 brand-new elsewhere (not re-worked) for under $200!

Or, by providing little info on their purchasing online website - IE, Selling phones with such basic info such as "Samsung Galaxy S5", with no information on which sub-model it is, or which 4G frequencies it supports etc. This applies to other retailers also - and hence why I never purchase online - I always go in store the get the full product details in order to be fully informed.

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Satch

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#1475244 20-Jan-2016 11:59

dejadeadnz: I think it's quite naïve to keep focusing on the vouchers issue as though sorting that out will go on its own go a long way to making DS rescuable.

Try telling that to the people who purchased or received DS vouchers for Xmas! Public perception is going to go a long way to help DS's cause and by keeping people's money without providing them with product isn't helping at all IMO.

richms

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#1475249 20-Jan-2016 12:01

Public percepton among people I have talked about it with (Including some really old ones) is how the hell has it taken this long to happen.

The brand is shot. I feel sorry for the old guy for not doing something to be able to recover his name and likeness if something like this happened.

Richard rich.ms

antonknee

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#1475620 20-Jan-2016 18:49

richms:

Public percepton among people I have talked about it with (Including some really old ones) is how the hell has it taken this long to happen.

The brand is shot. I feel sorry for the old guy for not doing something to be able to recover his name and likeness if something like this happened.

Yep same here pretty much. I don't know anyone (outside of my job) who enjoyed DSE as a company or a brand before this all went down, let alone now.

On your second point I don't really know anyone who associated Dick Smith the retailer with Dick Smith the man anymore either, especially given he is Australian and not a big part of our culture.

Jaxson

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#1475776 20-Jan-2016 22:50

Did others get the receivership sale email tonight?

Stu

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#1475779 20-Jan-2016 22:53

The Mates Rates email? Wasn't impressed.

People often mistake me for an adult because of my age.

Keep calm, and carry on posting.

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dejadeadnz

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#1475789 20-Jan-2016 23:28

Satch:

dejadeadnz: I think it's quite naïve to keep focusing on the vouchers issue as though sorting that out will go on its own go a long way to making DS rescuable.

Try telling that to the people who purchased or received DS vouchers for Xmas! Public perception is going to go a long way to help DS's cause and by keeping people's money without providing them with product isn't helping at all IMO.

I didn't say it won't help. But it will not go a long way towards making DS a viable going concern moving forward. Personally I have been very impressed with the insights provided by many posters in this thread as to why DS is failing. Unless the receivers or any prospective buyers can overcome most/all of the issues facing DS, it should just die. Based on my own observations, in many instances its continuing existence is literally spoiling and lowering the tone of the malls and surroundings in which its stores are placed.

mattwnz

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#1475793 21-Jan-2016 00:13

Jaxson: Did others get the receivership sale email tonight?

Yes, I still seem to be getting their emails, even though I am sure I unsubscribed. It is pretty much the same type of deal they had before the receivership. The discounts don't look any better than normal, and look more like normal sale rotations. Except this time they are using receivership sale as a selling point, as well as a cashback promise. They are selling a JVC ELED TV for about 25% off which isn't a big percentage. They also refer to it as a DLED Tv in another place. What the heck is a ELED or DLED tv?

richms

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#1475804 21-Jan-2016 03:48

Edge lit or direct lit panel

Richard rich.ms

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