“Despite closures of some stores and further downsizing measures, declining sales meant that the director of the company took the decision that trading could no longer continue.
“The voluntary administration process aims to achieve the best outcome for all stakeholders. This may include selling the business and assets to interested parties.”
The administrators said they were calling for urgent expressions of interest.
Administrators said they met with staff at 8.30am today to explain the process going forward.
“The aim is to reopen stores later this week,” they said.
“The administrators appreciate this is an unsettling time for everyone at the company.”
Customers who have paid deposits for purchases will be contacted directly by the administrators over the coming days.
Investment company Polar Capital, owned by Colin Neal, bought Smiths City in 2020 in a deal worth around $60 million.
However, the Herald reported at the time that the net amount expected to be received was $8m after debt and other liabilities.
Smiths City rebranded its business that same year under new ownership in an attempt to revive the brand and shake off previous ownership pitfalls.
The company hit headlines in 2018 after an Employment Court ruling ordered the retailer to pay staff approximately $1.5m in unpaid wages for their attendance at “voluntary” sales meetings over a six-year period.
The voluntary administration of Smiths City comes a fortnight after nationwide kitchen and laundry appliance company Kitchen Things went into receivership after suffering ongoing trading losses.
Twelve Kitchen Things stores were temporarily closed as a result of the receivership, while an independent store in Hamilton remains open.
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.
