R.I.P. DSE

DSE

The knives are out over the carcass of Dick Smith Electronics.

And, surprisingly, it has nothing to do with their completely confusing advertising campaign last year that featured “The Mad Butcher”, Sir Peter Leitch.

At least they didn’t advertise “55 Inch LED TVs – only $9.99 a kilo!”

A couple nasty viruses called “Greed” and “Private Equity” fried DSE’s circuit boards and the damage seems irreparable – our memory files of Australasia’s most well-known electronics stores have been forever corrupted.

I remember going to Napier’s first Dick Smith store with my Dad in 1980-something-or-other.

It was a tiny shop on Latham Street, just a couple hundred meters towards Marine Parade from and on the opposite side of the road to McLean Park.

It was packed full of the “latest” 1980’s innovations – Car radios with cassette tape players and the most basic of digital watches not to mention shelves full of plugs, switches, wires, diodes and solder.

The epitome of tech DIY!

There was so much stuff in these small shops you almost expected Arkwright or Steptoe to pop their head out from around the counter corner and try to sell you half their stock.

But they didn’t.

Instead there was a small, quiet man – almost certainly wearing glasses and a sleeveless knitted vest that answered your questions and pointed you in the right directions to get just what you needed.

There were no bells and whistles (unless you were looking at wiring up an early home security alarm) because the shop manager was an electronics hobbyist himself – he knew where each gauge of wire, light emitting diode and self-returning switch was and exactly what they did.

They weren’t rocket scientists, but by 1980’s provincial New Zealand standards they weren’t far off.

We purchased our first ever computer, a Sinclair ZX81, from that shop.

ZX81

You had to plug it into the TV via the aerial lead and tune it in to get a picture. With no on-board memory, programmes were loaded and saved via either plug-in cartridges, or a cassette tape recorder that also needed to be plugged into the tiny keyboard / motherboard unit.

While there appears little doubt these private capital chumps are guilty of killing Dick Smith Electronics off financially, it could be argued that advances in technology had been undermining the chain’s original core customer base for many more years before that.

As technology developed it got considerably smaller, phenomenally cheaper and required far less input.

Where once, back in the 80’s, someone would spend weeks and hundreds of dollars building their own computer or some other type of electronic timesaving gadgetry, today you could pick up the same item for $10-$20 at any one of hundreds of discount electronics stores, who bought the item in bulk from some massive production facility where workers are paid five cents per item produced.

When that item breaks or stops working, do you try to fix it like my father’s generation did? No, you just buy a new one at an equally cheap price.

There has been a generational attitude change from “Do It Yourself” to “Cheap and Nasty”, which is a great shame. Because not only does it enable those who pay a pittance for the production of electronics and then make massive profits themselves, it also detracts future generations from investigating just how things work, thinking up ways of improving them and making improvements themselves – we’re wiping out a skill set!

Dick Smith himself lamented the change in culture. When Supermarket chain Woolworths bought him out they steered away from core basic electronics into these dangerous waters of cheap, premade electronic goods.

The service in the stores seemed to echo an equally cheap supermarket mind-set.

Gone were the studious, knowledgeable old men. In came fresh faced teenagers – cheap to employ, apparently not worth training much beyond cash register usage or incentivising in sales – just as disposable as the goods they sold.

In the last few years I went into Dick Smith stores several times and am still waiting for anyone to ask if I needed any help finding what I was after – I did, so left the store empty-handed and found what I was after elsewhere.

The loss of Dick Smith Electronics is a sad one, especially for those who are now left out of pocket and potentially jobs by those who blew smoke, erected mirrors, took the money and ran. But it was not unforeseeable – just like the demise of the video store.

Perhaps if someone could make a time machine we could travel back thirty years into the past and warn those in charge of Dick Smith to focus on their core products and put passion for what they do ahead of profit.

If only there was still somewhere we could by the parts for a Flux Capacitor..

H.O.Y. A Gift Horse, or Trojan Horse?

"Where are we going, Wilbur?"

“Where are we going, Wilbur?”

The digital ink (?) on my previous post about volunteers being worth far more than they weren’t paid had barely dried over the Christmas break when I read that Hawke’s Bay’s multi-million dollar equine extravaganza – “Horse of the Year” was looking for around 400 volunteers to assist with the 2016 edition of the event.

Nothing too unusual there – as previously stated such big events rely on volunteers to make them successful – although it pushes the limits of credibility to claim anything requiring dozens or even hundreds of people working for free as a “success” – from a financial perspective at least.

BUT…

400 sounded a rather excessive amount of people working for free – the Rugby and Cricket World Cup games Napier hosted in 2011 and 2015 respectively required only around 150-200 by comparison.

And the last time I had read something about Horse of the Year they were asking local councils for money – LOTS of money:

Last year chairwoman of Horse of the Year’s board of directors and HDC Deputy Mayor, Cynthia Bowers, went around local councils asking the event’s hosts, Hastings District Council – to increase their funding of the event to $150,000 – more than quadrupling the $35,000 they put forward last year, and $100,000 from the Napier City Council – TEN TIMES last year’s amount of $10,000!

In 2012 Councillor Bowers was appointed by Hastings District Council to a board investigating the formation of what would become “Horse of the Year (Hawke’s Bay) Limited” – she was quoted as saying:

“The working capital expected from the council was not likely to be more than $100,000 and the money would be repaid from projected profits from the 2013 show, which would be the first event run under the new company.”

These requests for more funding may be looking a bit shaky as they come not long after the event posted equally big losses in recent years:

In February last year, the month before its 2015 event, Horse of the Year reported a $297,000 half-year loss:

“The accounts show the company received income of $554,000 during the six months to the end of November, $297,000 below the $851,000 it budgeted for and $62,000 below what it received during the same period a year earlier.

However, in a report to the committee, the council’s acting chief financial officer, Bruce Allan, said: “Given the nature of this organisation and the event that it runs, the first half of the year financials provide limited insight into the potential full-year result.”

The show sends out invoices for deposits for booked trade sites during the half-year covered by the report, with the bulk of its income generated in the following six months.
The company said trade site sales for this year’s show had been strong “and indications are that virtually all sites will be sold”.

In October 2014 Horse of the Year had recorded a $108,000 full-year loss.

Horse of the Year were reported as expecting 2015’s event to be a “no growth” show in an attempt to make up for previous losses.

Hastings District Council said the lost revenue in 2014 was “due to problems with security fencing which allowed non-payers into the show.”

But it’s a bit hard to believe such significant losses were due to people sneaking in for free, considering even if tickets were $50 each, that would mean over 2,000 attendees got away without paying.

A more likely cause was the “Further development of relationships with Chinese equestrians, who were funded to attend last year’s (2014) show, had been “put on hold until 2016”.”

In other words “An international equestrian group were PAID to attend two years ago, but didn’t turn up and it doesn’t look like anyone asked for the money back.”

So what was the extra $205,000 Horse of the Year was requesting supposed to be going to?

Certainly not paying up to 400 workers…

Perhaps is going towards debt consolidation?

Perhaps they are paying for even more international equestrians to not attend?

Or perhaps they are looking at diversifying – Just how much are Pegacorns these days?

Horse of the Year is a great event for Hawke’s Bay that brings in hundreds of visitors and millions of dollars – and not just from the Range Rover / Multimillion dollar horse float crowd – Because for every futuristic horse-float-come-campervan there are dozens of regular horse loving attendees who stay in tents and motels, scrimping and saving where they can.

Investments and outcomes need to match up.

This is certainly one gift horse Hawke’s Bay cannot afford to look in the mouth!

Pegacorn