Woolies To Sell Off Dick Smith, Close Up To 100 Stores [Updated]

Woolies To Sell Off Dick Smith, Close Up To 100 Stores [Updated]

If you’re a fan of bricks and mortar electronic retailing, it looks like your shopping choices are about to get a bit more limited. Woolworths (owners of, amongst other things, the Dick Smith Electronics chain) has announced the results of a review into its consumer electronics business. The verdict: Dick Smith Electronics has got to go.

Specifically, the report notes that “the investment and management attention given to Dick Smith have been disproportionate relative to its position within the Woolworths group” and that “the future of the Dick Smith business, which is profitable, experiencing positive sales growth and has a strong brand position, could be better realised through new ownership.”

So, in other words, it’s looking for a buyer. But not for all the Dick Smith stores; the report also notes:

In order to maximise value and best position the business for divestment, Woolworths will implement a number of business improvement initiatives identified by the strategic review, including accelerating the rationalisation of the store network, with up to 100 underperforming stores identified for closure within the next two years. Affected staff will be offered redeployment elsewhere in the Woolworths group.

Woolworths isn’t abandoning consumer electronics per se; it’s more interested in focusing its efforts around Big W stores, according to the report.

Update: CRN quotes Dick Smith (who, it should be noted, hasn’t had anything to do with Dick Smith Electronics for a good long time) on the sale as follows:

It’s all so predictable, I’m amazed that Dick Smith has been able to operate profitably for so long. Woolworths has made an absolute profit out of it, but the time has come for that type of business. If I’d still owned Dick Smith, I would have moved the whole operation to Hong Kong, still employed Australian staff and couriers, but everything would be sold by mail.