Approximately $995,000 worth of debts was uncovered after the first creditors meeting of Adelaide-based distributor, BMS Technology.
BMS Technology entered into voluntary administration on 10 October, with Peter Ivan Macks and Ian Wayne Burford from Macks Advisory being appointed administrators.
The first meeting of creditors, which was held on 19 October, revealed that BMS entered administration owing $272,265 to Netgear, $229,188 to Kyocera Document Solutions Australia, $184,850 to Toshiba Client Solutions and $161,513 to Eaton Industries.
The copy of minutes also showed amounts owed to Epson Australia ($45,000) and Synnex ($36,000).
BMS Technology was founded 30 years ago in Adelaide. The distributor had opened two other offices: on in Perth in 2012 and another in Melbourne in 2016.
According to Paul Rugari, the financial controller of the company, as the company had Adelaide as its main market things grew difficult with an “economic climate becoming more challenging to handle”. There were also sales downturns nationwide and challenges going forward were too great for the company.
According to Peter Macks, the company holds a stock of approximately $1.3 million and employee entitlements and amount outstanding ads up to $293,000 as at 18 October.
The administrators also said that debtors have been paying outstanding accounts to them.
“The key to the financials is the collection of debtor amounts and returning stock to secured creditors – the significance of this being a reduction in creditors with stock returned,” according to the meeting documents.
After administrators were appointed, Leader Computers managing director, Theo Kristoris, confirmed it was looking into BMS’ assets but was still waiting on news from administrators.
Macks said that it has also engaged with certain staff to deal with issues in relation to the distributor’s stock, suppliers, returns and repairs, so that customers aren’t too disadvantaged.
In October last year, BMS celebrated its 30-year milestone. Its distribution stable included Toshiba notebooks and accessories, Netgear, Eaton, Kyocera and its own-branded BMSTECH products featuring data cabinets, racks and cabling products.
BMS also touted itself as the only Australian Toshiba distributor that was also a Toshiba Premier Authorised Service provider, meaning that resellers could deal with one company for their notebook upgrades, configuration work, warranty and repairs.
It had a service department based in Adelaide, which won many service awards including Toshiba ProCare service award.
On 19 October, ARN revealed that the company directors, John and Beverley Reid, decided to appoint administrators after accepting the reality there was "no future for the business”.
John Reid said in a statement from the administrators that the company had gone from not making a profit to making losses. Closing the business at this time was a hopeful step in making sure that it was able to cover its debts and give employees a better chance of finding new jobs before Christmas.
“Despite everyone’s best efforts there just hadn’t been enough sales to cover costs,” the administrators said in a statement. “The economy was such that sales were getting harder and harder to find."
“The staff have been the backbone of the company, so the first priority was to ensure they had the best possible options. The voluntary administration process is not something they have entered into lightly.”