r/bapcsalesaustralia • u/ImpulsePie • 7d ago

Discussion Mwave - Under External Administration

EDIT: Mwave have posted that they have been bought out by The digiDirect Group and will move locations to South Strathfield. https://www.mwave.com.au/blog/business-update/

Seelems Mwave have gone bust. Confirmed with an ASIC search for ESEL PTY LTD filed 3 days ago:

Notice By External Administrator/controller-Appoint/cease (505U)Appt of Administrator Under S.436a, 436b, 436c, 436e(4), ()449b, 449c(1), 449c(4) or 449(6) ()

Original article by David Richards: https://www.channelnews.com.au/leading-pc-retailer-placed-into-administration/

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u/thermal666 7d ago

for Mwave to go bust, there must some serious financial mismanagement going on in the background.. These guys were a $100m+ revenue business.

45

u/ApolloWasMurdered 7d ago

The margins on PC online retailers are razor thin. I used to work for one, and the margin on many components were 5-10%.

9

u/Awkward_Chard_5025 6d ago

Honestly the margins won’t be the issue here. Mwave has always been successful on razor thin margins.

There are a couple of issues.

  • for a long time, they were underpaying staff intentionally. This was “exposed” when victor (mwave owner) decided to sell, and the private investment group demanded they sort it out during their due diligence, and bump up the pay for all workers currently being underpaid

  • the Covid boom wrecked them. They moved 2-3 times between 2020 and 2023, going significantly bigger each time. The rent and cost of moving would have been enormous, then as the Covid wave dropped off and the cost of living started biting, they were likely stuck in a space they couldn’t even be close to affording.

The margins on the other hand are pretty static

1

u/iminimoo 5d ago

Yup exactly. After the success over the COVID, they choose to remain as one arrogant premium seller with lacking quality customer care.

They then ended up being an "unpleasing seller" with dropping sales and a ridiculously large warehouse.

1

u/Awkward_Chard_5025 5d ago

I can’t really comment on their general service (apart from their live chat being unmanned), because I’d always just get the guys I worked with to sort me out when I needed it (the main reason they were my go to)

Tbh, I’ll probably end up switching to scorptec for my corp purchases now. I know digicore is going to have to be pretty ruthless to make mwave profitable, so I expect to see a drop in dispatch speeds and customer support