Dick Smith
A worker holds the security gate covering the main entrance of a Dick Smith store in Sydney, Australia, February 26, 2016. Bankrupt consumer electronics retailer Dick Smith Holdings Ltd will close down its remaining 363 stores in Australia and New Zealand after failing to find a buyer, receivers and managers of the company said on Thursday. Reuters/David Gray

Beleaguered electronics seller Dick Smith has been saved. Online retailer Kogan has bought all of Dick Smith’s online businesses for an undisclosed amount, almost a month after the latter announced the closure of its stores.

Dick Smith announced in February it would close its remaining 301 stores in Australia and 62 in New Zealand after its receivers failed to find a suitable buyer for the company. The collapse has resulted in the loss of thousands of jobs in both countries.

Kogan, Australia’s largest online-only retailer, will “continue the legacy” that the Dick Smith brand started. It will run the brand in Australia and New Zealand.

“Dick Smith is an iconic Australian brand and we’re thrilled to be able to keep it alive, as well as Aussie owned and run,” founder Ruslan Kogan told Gizmodo. “We will invest in building and nurturing the Dick Smith community, and honour the great legacy of this Au

He continued, “I remember as a kid always visiting Dick Smith to look for parts to upgrade my computer. There is a strong history of passion in the Dick Smith community for how technology can improve our lives, and we look forward to helping make it more affordable and accessible for all.”

The founder added that his company has bought the entire Dick Smith online business, including its goodwill and brand. The motivation to purchase the other company, he said, was to “save the legacy of this great Australian brand.”

Kogan will run the Dick Smith online business from June 1. As Kogan operates, Dick Smith will also transition to an online-only model. It will continue to provide consumer electronics and appliances, but will be optimised to a more innovative and streamlined business model.

This does not mean the Kogan and Dick Smith names and businesses will merge, however. As Kogan predicted, the combined buying power of both companies will enable them to trade on more favourable terms and give consumers more savings.

Dick Smith’s downfall has also resulted in customers who lost money with gift cards and lay-buys getting angry. Bringing back customers’ trust will be Kogan’s biggest challenge yet. Kogan said the company will begin improvement by rebuilding the trust that was lost.

“Ultimately, a brand grows when it delivers on its promises. We will work tirelessly to exceed the expectations of every Dick Smith customer with a beautiful shopping experience,” Kogan promised.

Barry Urquhart, the managing director of retail specialists Marketing Focus, warned that Kogan might find their own brand damaged as there would be customers who would not believe the newly restructured model of the company.

“If they are going to communicate, it will be emotional, confronting and affronting,” Urquhart told Mumbrella. “It has potential for huge brand damage. They are not buying the goodwill of Dick Smith.”

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