Dion Wired to close all 23 shops

PULLING THE PLUG: The Baywest Mall branch of Dion Wired
PULLING THE PLUG: The Baywest Mall branch of Dion Wired

High-tech appliance giant Dion Wired will be closing all of their 23 stores nationwide.

The closure was meant to take place on Thursday, but at midday the Baywest Mall branch was still open for business.

On Thursday, the website stated that Dion Wired was “closed for business” and customers were referred to sister company Game.

The website also directs customers to Game stores for payment and collection of their lay-bys.

It is unclear at this stage how many jobs are affected.

The retailer is battling with municipal cost increases and a consumer environment characterised by rising unemployment and subdued wage growth.

Massmart, majority-owned by Walmart, previously said management would close trading at 23 Dion Wired Stores on March 19 and decide whether to cease trading at 11 Masscash stores.

A Massmart insider said the Masscash stores were also set to close, but a decision on when this would take place was still unknown at this stage.

Masscash consists of a wholesale division with cash-and-carry food and cosmetics businesses, and retail food outlets which target the lower  income groups.

The wholesale division consists of CBW, Jumbo Cash and Carry, Trident and Shield, while the retail division is consolidated under the Cambridge Food banner and the Rhino Group.

In a statement issued on Thursday, the company said it would continue talks with labour unions on measures to mitigate job losses and look at moving affected workers into vacant roles in other stores “where practical and reasonable”.

In the year ended December 31, Massmart’s mass discounters division, which comprises Dion Wired and Game, fell to an annual trading loss of R674.6m from a profit of R32.6m, hurt by lower consumer spending on electronics.

In January, The Herald reported that Massmart could retrench about 3% of its workforce as it continued a turnaround strategy under new CEO Mitchell Slape.

After conducting a store optimisation project that highlighted a number of underperforming stores, the group began consultations that could affect 1,440 employees across 34 Dion Wired and Masscash stores.

A team from The Herald visited the Dion Wired store in Baywest Mall and saw staff working.

There were no closure notices and the shelves were still stocked.

The staff were reluctant to speak to the team but one staffer said they had not received any communication from their head office about closing down.

He said they would still go to work on Friday unless they were told otherwise.

Massmart said The difficult decision was made after consultation, facilitated by the CCMA, with affected colleagues and their representatives.

“Together, numerous alternatives to store closures were explored but ultimately [we] failed to identify workable options that would return the stores to sustainable profitability.”

“Massmart continues to approach this difficult situation in a sensitive and caring way.

“To this end our focus and priority is to leverage opportunities to preserve jobs through continued CCMA facilitated consultation, with affected colleagues and their representatives.”