Dick Smith in store decline

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#1482992 1-Feb-2016 17:23

JimmyH:
I got their pamphlet in my letterbox yesterday.

It seems to feature phones (eg the Galaxy S5) on sale for more that Noel Leeming's regular price, as well as flashdrives and memory cards on "super special" at twice the price of the same product in the Warehouse Stationery, and three times the price at PB tech.

Not exactly compelling..........

After a couple of days their webmaster got around to putting the catalogue on the website. As for the flash drives I wouldn't trust them for anything important.

amiga500

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#1483012 1-Feb-2016 17:53

In a story published by Smartoffice.com.au the headline says 'No real bidders for Dick Smith, supplier support evaporates'. In the story they predict closure of stores and liquidation. Mention is made that major suppliers such as Samsung would prefer to deal with the big retailers - Harvey Norman etc. Story was published on 28 or 29 Jan. You should be able to find the whole story from the headline.

dejadeadnz

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#1483264 2-Feb-2016 09:26

Everything that is occurring is reinforcing my view that this is the most awfully handled receivership imaginable.

amiga500

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#1483444 2-Feb-2016 12:12

dejadeadnz:

Everything that is occurring is reinforcing my view that this is the most awfully handled receivership imaginable.

Including pricing! According to Pricespy 37 NZ shops selling the Canon SX60HS cheaper than DSE.

amiga500

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#1483484 2-Feb-2016 12:51

Here is a Youtube Hitler parody on the Dick Smith sale from 2012 titled:

Bad Dick Smith.

Dick Smith's screws up the sale, and Hitler isn't happy. (sub title)

Sorry, not posting the direct link but that is the title & should be easy to find. There is a whole series of the Hitler parodies & some are brilliant.

mattwnz

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#1483514 2-Feb-2016 13:12

It is like watching a slow car crash. Many people are just waiting for the big clearance sale.. if it occurs.

andrew027

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#1483524 2-Feb-2016 13:30

mattwnz: It is like watching a slow car crash. Many people are just waiting for the big clearance sale.. if it occurs.

Problem is, Dick Smith think they're already having it.

dejadeadnz

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#1483543 2-Feb-2016 13:48

I don't confess to be a retail expert but I do work for a major bank and have done corporate strategy work. And I've seen how receivers in other receiverships work. If I were DS and these receivers, I would start off by clearing out stuff that's low margin (e.g. Apple hardware) but with high per unit cost. Take a loss if you must: give 10% off and you might get some punters in (10% off on many Apple products will likely mean selling at cost or even loss-leading). Do bundle deals on the likes of Apple hardware with brand name accessories.

If they are serious about selling as a going concern, they desperately need to restock and retain some credibility with brand name suppliers supplying stuff that has higher margins. And this means they need cash. Instead, all I am seeing is DS and the receivers practically parodying their own failed strategies by reinforcing the oft-cited complaints against DS: high prices, poor range, poor individual stock item availability in-store, and concentrating on the wrong stuff (because prominently advertising that you're selling crappy, overpriced kettles etc at 20 - 40% off on your homepage just screams credibility!).

Jaxson

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#1483550 2-Feb-2016 13:55

andrew027:

mattwnz: It is like watching a slow car crash. Many people are just waiting for the big clearance sale.. if it occurs.

Problem is, Dick Smith think they're already having it.

With an A6000 going at near half price, they've already had it.

Only stuff left now is home brand iphone 4 cases etc.

When the doors really shut, there'll be a fire sale on the major stuff not yet touched. From mammary apple was one example, which wasn't cleared out cheap.

They may never be come to think of it, and instead may be purchased cheap by another retailer for example, so that apple products are never cheapened in the market etc.

richms

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#1483593 2-Feb-2016 14:53

mattwnz:
It is like watching a slow car crash. Many people are just waiting for the big clearance sale.. if it occurs.

It won't. They already have no stock that anyone wants to buy. How many HDMI cables do you need anyway? :D

Richard rich.ms

mattwnz

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#1483620 2-Feb-2016 15:02

richms:
mattwnz:

It is like watching a slow car crash. Many people are just waiting for the big clearance sale.. if it occurs.

It won't. They already have no stock that anyone wants to buy. How many HDMI cables do you need anyway? :D

When I last went in there was till heaps of stock, things like tablets, kindles, JVC TVs, household items etc, which they didn't initially discount. Also a big locked glass box full of apple stuff. I am guessing some of the stuff maybe returned to manufacturers.

Kyanar

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#1483779 2-Feb-2016 17:55

dejadeadnz:

I don't confess to be a retail expert but I do work for a major bank and have done corporate strategy work. And I've seen how receivers in other receiverships work. If I were DS and these receivers, I would start off by clearing out stuff that's low margin (e.g. Apple hardware) but with high per unit cost. Take a loss if you must: give 10% off and you might get some punters in (10% off on many Apple products will likely mean selling at cost or even loss-leading). Do bundle deals on the likes of Apple hardware with brand name accessories

You can't do that. Apple and suppliers like them tell you when you're allowed to sell their stuff on sale, you don't get to set prices yourself. And bundling is also a giant no-no unless you have permission (which Apple would not give).

mattwnz

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#1483821 2-Feb-2016 19:19

Kyanar:

You can't do that. Apple and suppliers like them tell you when you're allowed to sell their stuff on sale, you don't get to set prices yourself. And bundling is also a giant no-no unless you have permission (which Apple would not give).

Is that allowed under NZ FTA?

dejadeadnz

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#1483915 2-Feb-2016 21:01

Kyanar:

dejadeadnz:

I don't confess to be a retail expert but I do work for a major bank and have done corporate strategy work. And I've seen how receivers in other receiverships work. If I were DS and these receivers, I would start off by clearing out stuff that's low margin (e.g. Apple hardware) but with high per unit cost. Take a loss if you must: give 10% off and you might get some punters in (10% off on many Apple products will likely mean selling at cost or even loss-leading). Do bundle deals on the likes of Apple hardware with brand name accessories

You can't do that. Apple and suppliers like them tell you when you're allowed to sell their stuff on sale, you don't get to set prices yourself. And bundling is also a giant no-no unless you have permission (which Apple would not give).

I would be stunned if any company is dumb enough to actually tell a retailer directly what is in effect a minimum price, which is blatantly illegal under s 37 of the Commerce Act. And I know this stuff pretty well. Now I don't deny that there may be subtle pressures occasionally but when you are in receivership and trying to generate a buck, somehow I don't think such pressures would rank very high in priority were the receivers not out to have a cake and eat it too (they seem to want to generate cash and to keep DS as a viable going concern, whilst seemingly managing neither).

For the uninformed: http://www.comcom.govt.nz/business-competition/fact-sheets-3/resale-price-maintenance-2/

Handle9

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#1483931 2-Feb-2016 21:32

dejadeadnz:
Kyanar:

dejadeadnz:

I don't confess to be a retail expert but I do work for a major bank and have done corporate strategy work. And I've seen how receivers in other receiverships work. If I were DS and these receivers, I would start off by clearing out stuff that's low margin (e.g. Apple hardware) but with high per unit cost. Take a loss if you must: give 10% off and you might get some punters in (10% off on many Apple products will likely mean selling at cost or even loss-leading). Do bundle deals on the likes of Apple hardware with brand name accessories

You can't do that. Apple and suppliers like them tell you when you're allowed to sell their stuff on sale, you don't get to set prices yourself. And bundling is also a giant no-no unless you have permission (which Apple would not give).

I would be stunned if any company is dumb enough to actually tell a retailer directly what is in effect a minimum price, which is blatantly illegal under s 37 of the Commerce Act. And I know this stuff pretty well. Now I don't deny that there may be subtle pressures occasionally but when you are in receivership and trying to generate a buck, somehow I don't think such pressures would rank very high in priority were the receivers not out to have a cake and eat it too (they seem to want to generate cash and to keep DS as a viable going concern, whilst seemingly managing neither).

For the uninformed: http://www.comcom.govt.nz/business-competition/fact-sheets-3/resale-price-maintenance-2/

Yip. My understanding of the way Apple works is that they give the retailers sweet FA margin to play with as a means of maintaining ARPU however they don't actually price fix.

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