Dymocks denies move to exit New Zealand

By Karyn Scherer

Australian bookseller Dymocks has dismissed suggestions from its competitors that it might consider pulling out of New Zealand, after a bitter legal tussle with its main franchisee in this country.

The Sydney-based chain is due to take control of three of its New Zealand stores later this month, after an 18 month-long dispute with Auckland-based franchisee John Todd.

Mr Todd, who runs two Dymocks outlets in Auckland and one in Wellington, had his franchise agreements terminated last year after questioning the way the company was run.

Last week, the Court of Appeal rejected his bid to remain in the stores, but he is planning to appeal Dymocks' right to terminate the agreements.

Mr Todd opened his first Dymocks store in Auckland in 1994. His three stores are understood to account for more than 75 per cent of its New Zealand sales.

The chain originally said it hoped to open more than 20 stores on this side of the Tasman, but so far only four other stores have opened, in Auckland, Hamilton, Napier and Christchurch. Two were recently put up for sale.

The dispute has come at a difficult time for the chain, with The Warehouse becoming an increasingly big player in the book market, and with American book, music and video chain Borders due to open its first New Zealand mega-store in Auckland's Force Entertainment Centre later this year.

Whitcoulls' new general manager, Fran Stanley, said the industry was taking Borders seriously, although she personally believed it was more likely to hurt Dymocks. "It will help focus us on what we have to do."

Whitcoulls has reacted to competition from Dymocks by making its own move into the premium end of the book market. It is converting its poorly-performing London Bookshops chain into a new brand, Bennetts. Five Bennetts stores have opened so far, with another due to open in Wellington in August.

Mr Stanley admitted the chain was running "a bit behind" schedule, but said the company was happy with its progress and still hoped to open about 20 Bennetts stores nationwide.

During a visit to New Zealand yesterday, Dymocks' general manager, Keith Perkin, dismissed rumours that the chain was in trouble in this country as "just gossip". He declined to say whether all the stores were profitable, but said there was no intention of closing any stores "at this point in time."

He admitted the chain was a minor player in New Zealand, but said it was keen to stay and fight.

"We still believe there is potential for more Dymocks stores in this market but it's a matter of finding profitable locations."

Mr Todd said he was saddened by his fight with the company. The former Westpac economist has twice been voted Bookseller of the Year, and the chain has consistently been named Auckland's best bookstore by Metro magazine readers. He is prevented from opening rival stores for two years.

"We know we were doing a good job in terms of bookselling," said Mr Todd.