Meghead, the Chatswood reseller that for the past 10 years has been a fixture in one of Sydney’s busiest commercial centres, closed its doors last week, leaving a raft of debt in its wake.
Peter Ngan from Ngan & Co has been appointed liquidator for the reseller that stocked products from vendors such as HP, Canon, Epson and Toshiba. Ngan is in the process of selling all stock from the store, but it is unlikely employees or unsecured creditors will see any money.
The reseller had been in business since 1992, but shut up shop just after New Year, owing creditors about $100,000. It is believed the company owed money to a number of distributors, including Tech Pacific and MCT.
“After 10 years we have decided to call it a day,” said a message on the company’s Web site. “We would like to take this opportunity and thank you very much for your support.”
The demise of the company points to the difficulties of being a small IT reseller. Meghead was set up by husband and wife team, the McBrides. At the height of its success, the company turned over about $5 million a year and employed 15 staff.
Family issues and the changing nature of IT retail over the last three years saw business dwindle. Mr McBride left the company, leaving Beverly McBride and three of the employees, who came on as part-owners, to run the company.
“They bought into the business at its peak, but in the last financial year revenues dropped significantly,” Ngan said.
In the last six months of trading Meghead turned over less than $500,000. An expensive refurbishment of the store failed to attract additional business.
Ngan said the location of the business and its inability to compete with the rebates of large retail chains contributed to the closure.
“The nature of retailing has changed,” he said. “Small stores can’t be price competitive with the likes of Harvey Norman.”