What Woolworths Selling Dick Smith Will Mean For Customers And Staff

Nine months after putting it on the market, Woolworths has found a buyer for its Dick Smith electronics chain. Anchorage Capital Partners will purchase the remaining 325 stores, but what will that mean for consumers and the people who work there?

As we noted when Woolworths first announced its plans to sell off Dick Smith back in January, it will take a while before we see any clear impact in terms of pricing and product lines, and that remains the case even with a buyer. One obvious consequence will be that Dick Smith loses access to Amazon's Kindle e-readers, which have been sold exclusively through Woolworths-owned stores. However, since the cheapest way to buy a Kindle is direct from Amazon itself, that's not much of a concern for the savvy consumer.

More significant is that Dick Smith won't be able to take advantage of Woolworths' scale when purchasing product; it now stands on its own. That isn't necessarily a problem; rival JB Hi-Fi is highly competitive on price. Dick Smith rated well for customer service in a recent CHOICE shadow shopping exercise, but managed to annoy a lot of customers with a poorly-managed game sale earlier this year.

Anchorage is unlikely to want to hold the company for the long term; capital firms typically restructure businesses and then sell them to someone else. Woolworths alludes to that scenario in its announcement, which notes that it will receive $20 million this financial year but could also benefit from "any upside resulting from a future sale of Dick Smith by Anchorage". That's far more likely to mean additional store closures and redundancies than any kind of expansion. If I was a staff member, I'd be nervous, but we'll have to wait and see. [via CRN]

Trending Stories Right Now