Kogan to help Dick Smith customers with gift card swap offer

KOGAN, the largest online department store in Australia, has come to the aid of Dick Smith customers who have gift cards they can no longer use.

KOGAN, the largest online department store in Austalia, has come to the rescue of Dick Smith customers who have gift cards they can no longer use.

The popular website has set up a gift card swap program, where Dick Smith customers can send in their gift card or voucher and Kogan will email a $25 credit to use on products at Kogan.com.

In a post on their website, the company states: “We know it sucks to be out of pocket, which is why we want to help Dick Smith customers by offering them a Gift Card / Voucher Swap Simply post your Dick Smith Gift Card / Voucher along with your details to the address below, and we’ll email you $25 of Kogan.com credit to use on anything at Kogan.com. T&Cs apply*.”

The deal comes as Kogan founder and CEO Ruslan Kogan described the demise of Dick Smith as a “bittersweet solution”.

“Dick Smith has been an iconic Australian brand for decades and it’s sad to see their demise,” he wrote in a Linkedin post.

“It’s a sign of the changing retail landscape that has more and more Aussies turning online for the latest products at the best prices. It’s a bittersweet situation.”

While lamenting the situation, he added that his company loves “competition” to “drive down prices for shoppers”.

“On one hand, we love competition — it gets us out of bed in the morning. On the other hand, Kogan.com is proud to have played a significant part in creating more efficiency in the industry and driving down prices for shoppers, which has had a noticeable effect on many large retailers, past and present,” he said.

Ruslan Kogan has big plans for Kogan.com in the future.

“While it’s common for retailers to raise prices when there is decreased competition, there won’t be anything like that at Kogan.com — our mission is to make the latest products more affordable for all Australians and we’ll keep using technology to innovate new ways to drive prices down.”

There have been suggestions that the entrepreneur could be considering buying some of Dick Smith’s assets, but Mr Kogan has not confirmed anything.

When asked if he would consider buying Dick Smith or some of its assets, he told SmartCompany his business is “always considering all opportunities”.

Those left out of pocket by Dick Smith’s collapse are also calling on Coles and Woolworths to issue refunds.

Savvy start-up Prezzee has also announced that anyone who bought a Dick Smith gift card through its new app could claim its value against a gift card from one of its other partners, such as Myer and Veronica Maine.

The consumer watchdog is now speaking with the receivers at Dick Smith to find out how the electronics retailer’s collapse will affect customers further.

Receiver Ferrier Hodgson has said it will not honour gift cards or refund deposits on goods, prompting the Australian Competition and Consumer Commission to ask for more detail.

“The ACCC is currently making inquiries of the receivers about how they will be dealing with consumer issues arising,” the watchdog said.

Independent senator Nick Xenophon called on the corporate watchdog to urgently investigate the collapse and requested a parliamentary inquiry into whether the Australian Securities and Investments Commission missed warning signs.

“The corporate watchdog ASIC needs to explain to Australians how this great Australian company went into receivership with seemingly little warning,” Senator Xenophon said.

“We also need to know whether our corporate watchdog has in fact been asleep on the front porch while Dick Smith Holdings unravelled.” Dick Smith, which employees about 3,330 people across 393 stores in Australia and New Zealand, first warned in October its full year profit could fall as much as 15 per cent.

Wanting justice ... Dick Smith customers are angry.

It stepped up discounting and advertising to boost sales but the slump continued into November, resulting in the company dumping its revised profit forecast just a few weeks later.

The retailer then launched a pre-Christmas fire sale to clear unwanted stock that cost it about $60 million in writedowns, pinning its hopes on crucial holiday period sales, but sales remained worse than expected and the company’s shares were placed in a trading halt on Monday.

It went into receivership on Tuesday, with a syndicate of lenders including National Australia Bank and HSBC appointing Ferrier Hodgson with the aim of salvaging value.

Senator Xenophon demanded private equity firm Anchorage Capital Partners, which floated the company for $520 million in 2013 shortly after buying it for $94 million, appear before any parliamentary inquiry.

“It is an iconic Australian company and clearly it has been let down by a whole range of factors,” he told reporters in Adelaide. “But if Dick Smith is going to collapse on itself because the numbers just didn’t stack up and there appears to have been some creative accounting that is well within the rules, then maybe the rules need to be changed.” He said it was also time to “put the blowtorch” to private equity companies like Anchorage to closely examine their tactics.