Home > Latest News > Kogan Only Paid $2.6M For Dick Smith Brand Name + Assets As Brand Sales Slump

Kogan Only Paid $2.6M For Dick Smith Brand Name + Assets As Brand Sales Slump

As Ruslan Kogan spruiks potential investors new information has emerged relating to Kogan.com.

According to his prospectus issued to potential investors, Private Label sales only increased marginally this year from $77.5M in 2015 to $76.5M in 2016.

At the same time branded product sales dropped from $83M in 2015 to $65.6M in FY 2016.

Refunds and cancellations in 2016 totalled $11.5M which is 5.5%. The industry average is between 2.3 and 3%.

Kogan Mobile has only managed to achieve $400,000 in revenue this year, activations averaged 1,600 in March 2016.

It’s also been revealed that Kogan paid $2.6M to buy the Dick Smith assets that included, the Dick Smith brand name, DSE private label brand names and the Dick Smith database of 1.5M email subscribers.

Despite being described as having a net worth of over $400M Kogan claims that the Company had to reduce the spend on marketing due to “Cash Constraints”.

He said that Kogan.com is set to concentrate on Kogan Mobile, Kogan Travel and Dick Smith.

He also said that he is looking to launch new verticals and move into International markets with the capital raised via his IPO.

He has not explained why he pulled out of the UK market after bragging about the success of the invest in the UK market last year.

Kogan said that investment capital will be used to increase levels of private label brands.

This was a move that bought Dick Smith unstuck with the Company forced into liquidation with debts of over $400M. Subsequent investigations revealed warehouses full of private label products that failed to sell even when offered at a 70% discount.

Among the branded products that Kogan is banking on to drive sales are stock from, Philips, Epson, Black + Decker, Netgear, JVC, Uniden, Swann and Kambrook.

Missing are big brands such as Apple, Samsung, LG, Sony or Panasonic.

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