Nick Aboud’s Cheap As Chips Could Be For Sale
Cheap As Chips which is run by former Dick Smith CEO Nick Aboud could be up for sale as Australians take to shopping online.
The place where brands such as Blaupunkt TV’s are sold has annual sales between $100 million and $200 million and 40 stores, most of which are in South Australia and Victoria.
The Company which has performed well in the discount variety market during COVID-19 is opening new stores in locations that were formerly Target or Big W locations.
Alceon, which also owns 36 per cent of Mosaic Brands, online retailer SurfStitch and luxury fashion brand Ginger & Smart, bought Cheap as Chips four years ago. Nick Abboud was appointed CEO in November 2018.
Cheap as Chips chairman and Alceon Group executive director Richard Facioni said, “We’re getting ridiculous comparable [store] sales growth – some of that is from COVID,”. He said that sales are up 40 to 50 per cent year-on-year in some weeks during the pandemic.
One organisation that could buy the business is The Reject Shop according to the Financial Review.
The Reject Shop have enjoyed strong double-digit sales growth during the COVID-19 crisis as cash-strapped consumers snap up discounted household essentials.
Mr Facioni says Alceon is now considering whether to sell Cheap as Chips and allow new owners to oversee the next stage of growth.
“We’ve got it to a point now where it’s poised for growth, we need to work out whether we do that or let someone else do that,” he said.
The Reject Shop has $92.5 million in reserves after taking advantage of record pandemic-fuelled sales growth to raise $25 million in March.
Its shares have surged from a low of $2.40 in March to a three-year high of $8.28 last month amid expectations of a return to growth under new chief executive Andre Reich.
The retailer returned to profitability in 2020 after sales rose 3.4 per cent to $820.6 million, with same-store sales jumping 9.3 per cent in the March quarter and 5.1 per cent in the June quarter.