Kitchen Things customers told to pay thousands more for appliances after collapse

Kitchen Things is in voluntary administration and receivership. Photo / Jason Dorday

A Kitchen Things customer has been told they must pay almost $2000 extra to receive a stove they had already bought, while receivers demand top-up payments from frustrated buyers.

The kitchen and laundry appliance retailer, along with its related entities, is in voluntary administration and receivership, owing creditors more than $16.6 million.

The customer told the Herald that receivers at Grant Thornton had informed them they could only release a stove to them if they paid an additional $1899.50 on top of the original $3799 that they had already paid.

In a letter seen by the Herald, receivers explained to the customer that “due to the company not having allocated a specific item to your order before the commencement of the receivership, the transaction to purchase the item(s) had not been completed”.

The receivers said as a result, they were unable to trace a specific item to the sales order.

“Unfortunately, we cannot complete the original transaction as intended and amounts paid already cannot be refunded or credited,” the letter said.

The customer told the Herald that they felt there was so little that unsecured creditors could do.

“I know this can be standard practice in receiverships, but it feels like extortion,” they said.

“We know there is a floor model that is exactly what we had purchased but the receivers haven’t offered that to us.”

Another customer who was sent a similar letter was asked to pay a further $724.50 – or 50% again on the original price they paid for a Bosch washing machine.

“I happened to drive past the store to see they were having a sale all this week … I went in and a staff member located our machine via serial number but they phoned the [receiver] and we were told we could not take it until we received an email.

“I received [an] email asking us to pay 50% again on a newly generated invoice with the same serial number.”

Receivers for Kitchen Things wouldn’t answer questions from the Herald directly; however, pointed towards a FAQ for those affected.

The receivers say customers with legal rights to specific items “may be entitled to receive those items” where the item has been “legally sold before the receivership”.

However, it says “if a specific item of stock was not allocated to your order pre-receivership (with a specific serial number assigned), this means that the sale has not completed …

“The result of this is that you do not have a claim to a specific item of stock and any payments made towards that order become an unsecured claim against the company.”

The receivers say where items are available, affected customers would receive a letter of offer to buy those items at a price calculated by either: the remaining balance owed by the customer (for partially paid orders) or 50% of the sales price (for fully paid orders) per item.

Last week it was announced that Kitchen Things’ Napier and Nelson stores would permanently close.

However, receiver Stephen Keen from Grant Thornton said there was hope for other stores across the country.

“It’s unfortunate there has been a lack of interest in the Napier and Nelson stores, but we remain optimistic the other stores in Auckland, Tauranga, Wellington and Christchurch may be acquired by one of the interested parties we are working with.

“In the meantime, we are continuing to sell stock held at heavily discounted prices to achieve the best possible recovery.”

Cameron Smith is an Auckland-based business reporter. He joined the Herald in 2015 and has covered business and sports. He reports on topics such as retail, small business, the workplace and macroeconomics.