DICK Smith Foods, the company used by the entrepreneur cum philanthropist to generate millions of dollars for Australian charitable organisations is fast approaching its use-by date, founder Dick Smith said on Friday.
“We might be able keep it going another two years, but no more than that,” said Mr Smith.
He said in the past Dick Smith Foods turned over $60 million annually, that was now down to $15m to $16m.
“We’re very close to shutting the whole thing down.”
Mr Smith said originally Dick Smith Foods had been established because the iconic Australian product Vegemite had been bought by Kraft Foods, which in turn was owned by cigarette manufacturer Philip Morris.
“I couldn’t believe this company that was selling cigarettes to our teenagers owned Vegemite.”
He said the evolution of the global financial system to “extreme capitalism” had eroded opportunity for small companies to operate.
“Once there was room for Dick Smith Foods and little Aussie products, no more.”
But he said it was fantastic that Bega Cheese had managed to buy the brand back, and the Kraft stable along with it.
He said the entry of private corporations such as Aldi and Costco to the Australian market had forced Australian-owned companies such as Woolworths and Coles to change the way they did business.
“You’ve got to remember they are Australian-owned, publicly listed companies largely owned by pension funds.
“You can’t buy shares in Aldi, it’s a family owned German company.
“Unless Coles and Woolworths compete with Aldi, they’ll go broke,” he said.
“Aldi typically has 10 per cent of the staff of Coles and Woolworths and they have no product range.
“Once upon a time a young Australian could begin their working lives stacking shelves in a supermarket.
“Aldi doesn’t have shelves, they have products on pallets,” Mr Smith said.
“Once Coles and Woolworths had product diversity, more than 20,000 lines.”
But he said those companies were being forced to reduce those lines incrementally to compete with foreign companies that held no allegiance to Australia.
And he said the rise of companies fundamentally aligned against profit sharing would affect Australian farmers.
“Australian farms are not going to be able to supply the cheapest product,” he said.
“The Australian way of life is based around profit sharing, once upon a time everyone had to make a dollar.
“Take for instance our minimum wage, it’s double that of the US, let alone China,” he said.
“But that’s the madness of extreme capitalism, to succeed there must be continual growth, but the fact of the matter is, we live in a finite world.
“Consider Amazon, the company has never invented nor manufactured anything, it uses huge warehouses and robots to store and move vast amounts of products.
“Many people can only afford the cheapest products and many people simply buy the cheapest products,” he said.
He said worldwide the division between richest and poorest was staggering and Australia was no exception.
“I think the richest one per cent of Australians have wealth equivalent to the poorest 70pc,” he said.
But the Australian consumer can make a difference by buying Australian products, even though “they’re really hard to find and it will cost a couple of dollars a week to support Australian farmers”.
“But if we damage the bush, we will destroy our country.
“Even farmers are now looking at automation because they can’t afford to employ people.
“Every farmer knows you have to live in balance and you can’t entertain the concept of eternal growth.”
He said there would have to be a painful readjustment at some point.
“We’re quite stupid, look at the French revolution, look at the Russian revolution, eventually the poorest people will balance the whole situation out again with their pitchforks, but how stupid are we to let things get to that point?”