Retravision Southern will hold emergency meetings with its members tomorrow to discuss serious cash flow deficiencies that have resulted in suppliers not being paid for stock.
At a staff meeting at the group’s Melbourne head office this morning, staffmembers were guaranteed their entitlements should the company fall into administration.
“I can confirm that this morning we did have a staff briefing and at that meeting it was noted that things were tough for the Retravision Southern region,” said a spokesperson for Retravision chairman Ian Ray. “We are working through various ‘work-out’ solutions, and there have been some late payments with suppliers.
“We are making payments to suppliers but we are doing so in dribs and drabs.”
One supplier who contacted Appliance Retailer today showed us a copy of the email being sent. The text is printed here:
Dear Supplier,
Your EOM [end of month] payment due yesterday unfortunately was not be processed [sic], due to an issue with our bank. We are currently working on an resolution [sic], which should be resolved within the week.
The veracity of this email was confirmed by Ian Ray’s spokesperson.
“From what I understand, we’ve been in contact with each of the suppliers that we haven’t fully paid and we have arranged extended payment terms with them, or at least asked for extended payment terms, and they were checking with their credit area.
“As long as our request for extended credit was satisfied — we would have to juggle things around to address any rejections or refusals for those requests — but at the moment I can confirm that the company is solvent, that we’ve obtained legal advice that it is solvent and we fully intend to comply with all of our legal commitments.”
When asked to confirm that members were leaving the Retravision Southern group, the spokesperson said that six stores are in the process of “voluntary closure”, which was defined as “not being instigated by any enforcement action by Retravision Southern”.
The spokesperson further confirmed that the project manager for Retravision’s long awaited online retail store, codenamed Retravision Direct, had walked out on the company, though that did not necessarily mean the project had been scrapped.
“I’m not sure that [Retravision Direct] has been scrapped — I can’t comment on the details of the project — but I can confirm that [he] left the organisation two or three weeks ago. I’m not sure of his reasons for doing that: perhaps the project wasn’t developing as quickly as he’d hoped.”
When asked about the proposed meetings with members tomorrow — one Retravision Southern insider said these would be used to “beg members to bail out” the company — Ian Ray’s spokesperson said there would be two meetings, but that no begging would be taking place.
“I can confirm that there will be two meetings tomorrow: a telephone hook-up with Tasmania and NSW; and the second meeting will occur a little bit later in the morning, around 11am, when the Victorian members have been invited to attend personally.
“The purpose of the meeting is to provide an update and to address concerns that our stores themselves have regarding these noises in the market.”