Dick Smith (retailer)
| Company type | Public (formerly) |
|---|---|
| Industry | Consumer electronics retail |
| Founded | 1968 in Sydney, Australia |
| Founder | Dick Smith |
| Defunct | 2016 |
| Fate | Entered receivership and closed all physical stores; brand continues online under Kogan.com |
| Headquarters | Sydney , Australia |
Area served | Australia, New Zealand |
Key people | Nick Abboud (CEO, final) |
| Products | Consumer electronics, hobbyist parts, project kits, private-label electronics, proprietary computers |
| Parent | Woolworths (1980–2012), Anchorage Capital Partners (2012–2014) |
| Website | www |
Dick Smith Electronics Holdings Limited was a retail chain based in Australia, specializing in consumer electronics, hobbyist parts, and project kits. Established in Sydney in 1968 by Dick Smith, the company grew to operate in New Zealand and several other countries, although its success remained primarily within the Australian and New Zealand markets. Initially owned by Dick Smith and his wife, the business saw a 60% stake sold to Woolworths in 1980, with the remaining 40% divested two years later.
By 2012, the company managed 263 outlets across Australia and 62 locations in New Zealand, including 20 stores situated in Auckland. Following its acquisition by Anchorage Capital Partners, Dick Smith entered receivership and shuttered all physical stores in 2016. Despite this, the Dick Smith brand persists as an online presence under Kogan.com.
Early years
The enterprise commenced operations in 1968 from a modest $15-per-week space within a car park located in Neutral Bay, Sydney, starting with just $610 in capital. Initially concentrating on car radio installation and repair services, it rapidly expanded to larger sites first in St Leonards and then Artarmon, eventually establishing a flagship store along the Pacific Highway at Gore Hill.
After the Whitlam government implemented a 25% reduction in tariffs in 1973—significantly impacting the electronics sector—Smith pivoted towards importing components and finished goods. Beyond car radios, he launched "Dick Smith Wholesale" to cater to electronics enthusiasts, a niche largely neglected by major wholesalers. Drawing on international merchandising insights, Smith introduced self-service retailing and produced an annual mail-order catalogue featuring comprehensive technical specifications.
Publicity stunts
The company attracted public attention through daring promotional campaigns orchestrated by Smith himself. A notable example occurred in 1978 when he orchestrated an April Fool’s prank claiming he had transported an iceberg from Antarctica to Sydney Harbour to sell ice cubes for 10 cents each. This stunt garnered extensive media coverage despite the “iceberg” actually being a barge concealed with foam and plastic materials.
Expansion
Riding the wave of the CB radio craze during the 1970s, Dick Smith Electronics expanded its footprint across all mainland Australian states. Although many CB radio retailers closed by decade’s end, the company prospered by capitalizing on rising personal computer sales alongside its established range of electronic components and kits.
To connect with nearly every electronics hobbyist in Australia, Dick Smith distributed its catalogue free of charge within popular magazines such as Electronics Australia and Electronics Today International. These catalogues became indispensable resources by providing detailed component information.
Starting in the late 1970s, the company introduced private-label products under the "Dick Smith" or "DSE" brands—often rebranded versions of existing manufacturers’ items.
The business also developed successful proprietary computers including the Dick Smith System 80 (a clone of the Tandy TRS-80 Model I), Dick Smith Cat (an Apple II clone), VZ-200, and VZ-300 models. Additionally, it retailed well-known PCs like the VIC-20 and Commodore 64. In 1981, Dick Smith collaborated with Electronics Australia magazine to create the Super-80 kit computer.
Throughout the 1970s and 1980s, the product assortment broadened further to encompass Heathkit electronic kits, satellite television receivers, Beeple pagers, the Dick Smith Wizzard game console, as well as early telephone technologies such as answering machines and cordless phones.
Acquisition by Woolworths
By 1980, the business had grown to encompass 20 outlets when the original owner and his spouse sold a 60% stake to the prominent retailer Woolworths. The remaining shares were divested in 1982, totaling $25 million. Under Woolworths' ownership, the company continued to broaden its footprint with small "main street" stores situated throughout suburban and regional areas of Australia.
Powerhouse Expansion
During the late 1990s, the company introduced the "Dick Smith Powerhouse" superstores along the eastern seaboard of Australia, starting with a location in Bankstown in 1996. These stores, approximately in size, were considerably larger than standard outlets and featured dedicated departments for major product categories alongside supermarket-style checkout systems. Powerhouse locations provided an extended assortment of merchandise, particularly in computing, audio-visual gear, and amateur radio, while also incorporating Music products. Additionally, they offered services such as installation and computer repairs.
Between 2002 and 2003, the Powerhouse format evolved to target a wider consumer base, reducing emphasis on electronics hobbyists. The selection of components was scaled back, and general electronics literature was discontinued. After 27 years, the long-standing Yaesu amateur radio dealership was terminated. Electronic kits were relocated to smaller stores and momentarily replaced with small household appliances like kettles and toasters. A home installation service named "PowerSquad" was introduced to assist with setting up major devices including TVs and computers, as well as providing training on wireless networking and MP3 players. By late 2007, numerous small components, tools, cables, and connectors were shifted back to smaller stores, further distancing Powerhouse from its original focus on electronics enthusiasts.
Significant Transformations
In early 2008, following Woolworths' evaluation of its consumer electronics sector, Dick Smith Electronics revamped its flagship store at Westfield Hornsby, launching a "concept" branded as "Dick Smith Technology." This redesign involved altering the store layout and product offering by removing electrical components and many tools. In their place came an expanded range of Windows PCs, gaming equipment, televisions, and Mac computers—items previously predominantly available only in Powerhouse outlets.
Subsequent strategic assessments led to further development of this concept under the banner "Dick Smith – Talk to the Techxperts," consolidating all Dick Smith Electronics and Powerhouse locations under one unified brand. By late 2008, this refreshed branding and format were implemented, with numerous Powerhouse stores such as those at Macquarie Centre and Auburn adopting the new identity.
"Large Format Stores" launched in venues including Chadstone Shopping Centre, Bendigo, Marion, Perth, Innaloo, Rockingham, Hobart, and Stockland Rockhampton, all operating under the "Dick Smith – Talk to the Techxperts" label.
In March 2009, Woolworths CEO Michael Luscombe announced the discontinuation of Powerhouse as a distinct brand and revealed plans to phase out its third consumer electronics brand, Tandy, gradually over three years as leases expired. This move consolidated "Dick Smith" as Woolworths' exclusive consumer electronics brand.
The mail-order catalogue that had been central to the company's early achievements was discontinued in 2009 in favor of online retailing.
Acquisition by Anchorage Capital
On 31 January 2012, following nearly three decades of ownership, Woolworths revealed a $300 million restructuring plan which included shutting as many as 100 Dick Smith outlets and divesting the business. In September 2012, the company was acquired by Anchorage Capital Partners for an initial cash payment of $20 million, with the total transaction value approaching $115 million. It has been suggested that Anchorage contributed only about $10 million upfront, financing much of the purchase through the liquidation of stock and assets—a maneuver described as "the greatest private equity heist of all time." Nick Abboud was appointed CEO in November 2012.
In December 2013, Anchorage took Dick Smith public by listing it on the Australian Securities Exchange (ASX), transforming it into a publicly traded entity. At the time of listing, the market capitalization reached $520 million—more than 25 times Anchorage’s original cash outlay less than two years prior. Anchorage initially maintained a 20% stake but completely exited by September 2014.
Alliance with David Jones
Starting 1 October 2013, Dick Smith managed the home entertainment sections within 30 David Jones stores as well as online across Australia. Operating under the brand "David Jones Electronics Powered by Dick Smith," this collaboration focused on televisions, computers, tablets, home office equipment, audio-visual gear, and digital products, with both staff and inventory transitioning to Dick Smith’s control.
By late 2014, annual sales had risen to $1.4 billion.
Fraud
Prior to its collapse, company executives engaged in fraudulent accounting practices to obtain $125 million in loans by falsely asserting these funds were intended for Boxing Day inventory purchases. CFO Michael Potts was convicted and mandated to repay $43 million to National Australia Bank in June 2021. This scandal is viewed as one of the largest private equity frauds, with Anchorage Capital converting a $10 million investment into $520 million within less than two years. Numerous lawsuits and class actions ensued while the Australian Securities & Investments Commission faced criticism for its limited enforcement and undisclosed investigations.
Closure
On 4 January 2016, trading was suspended after share prices plummeted more than 80% since Dick Smith’s December 2013 ASX debut. The following day, major creditors NAB and HSBC placed Dick Smith Holdings Limited into administration. McGrathNicol were appointed administrators; meanwhile creditors selected receivers Ferrier Hodgson. CEO Nick Abboud resigned on 12 January.
With no buyer forthcoming, receivers announced on 25 February 2016 that all 363 stores across Australia and New Zealand would close, resulting in approximately 2,460 job losses.
On 15 March 2016, online retailer Kogan.com, established by Ruslan Kogan, purchased the Dick Smith brand name, trademarks, intellectual property rights, and online operations for Australia and New Zealand for an undisclosed amount. The brand then shifted exclusively to an e-commerce model offering a broad selection of consumer electronics.
The final brick-and-mortar locations shuttered on 3 May 2016.
On 25 July 2016, remaining assets were placed into liquidation by creditors, with anticipated losses reaching up to $260 million.
Although uninvolved for more than thirty years, founder Dick Smith voiced disappointment over the closure, blaming it on "the utter greed of modern capitalism."
Hong Kong
Dick Smith Electronics' initial international expansion took place in 1978 with the establishment of Dick Smith Electronics (HK) Limited in Hong Kong. This operation consisted of a modest purchasing office and a single retail outlet located on Ashley Road, Tsim Sha Tsui. The store primarily catered to tourists, notably Australians seeking tax-exempt DSE merchandise, supported by an international version of the main product catalogue. However, due to intense local competition and unsatisfactory sales performance, the Hong Kong venture was discontinued in June 1980.
New Zealand
In 1981, Dick Smith Electronics formally registered in New Zealand and is believed to have launched a retail store that same year. The company expanded significantly in 1992 by acquiring David Reid Electronics, a chain comprising approximately 30 stores, which occasionally led to two Dick Smith stores operating within the same suburb. At its zenith, Dick Smith Electronics managed over 75 outlets across New Zealand, including several "Powerhouse" branded stores introduced in locations such as Hamilton, Manukau, Sylvia Park, and Palmerston North. Additionally, a "Dick Smith Technology" store opened in Lower Hutt, offering a comparable selection of products. Their online platform incorporated search functionality powered by SLI Systems to improve customer navigation. The Powerhouse brand was phased out in 2009.
United States
Starting in 1980, DSE operated a limited number of stores in both Northern California and Los Angeles; however, the company withdrew from the U.S. market before the conclusion of that decade.
Sponsorships
Dick Smith Electronics served as a sponsor for the Melbourne Stars cricket team competing in the T20 Big Bash League, as well as multiple tennis events including the Hopman Cup, World Tennis Challenge, Brisbane International, and Sydney International. The company also supported the nine-a-side rugby league competition known as the NRL Auckland Nines and was a principal sponsor of the Richmond Football Club within the Australian Football League from 2008 through 2011.
See also
External links
- – Australia
- – New Zealand