South African secondhand tech retailer Powerbite has closed its shops and shut down its online store, leaving numerous customers fuming over undelivered goods and delayed refunds.
The first Powerbite store was opened in June 2019 in Seapoint by rugby player Duncan Matthews.
Powerbite claimed the honour of being one of the first Apple-certified pre-owned shops. It allowed customers to trade in older model devices for new versions, and to sell secondhand gadgets for cash.
The company expanded to two more locations over the last two years and has been selling a variety of smartphones, laptops, tablets, and other gadgets.
The Powerbite website now states that it is no longer taking orders and has “started the process of applying for business rescue or liquidation”.
“We sincerely apologise for the inconvenience and will provide further information once we have feedback,” the message states.
Powerbite said it could not issue any refunds or payments “at this moment” and that it had sent all its employees home.
MyBroadband was also contacted by two disgruntled Powerbite customers who had not received their orders or a refund for several weeks.
One of the customers said the business appeared to have been operating on backorders for “quite some time” while being fully aware that they had financial problems.
He claimed the store had continued taking orders until Friday 13 August, before locking their offices, cutting their phone lines, and taking down their website.
His order was worth R13,500, and he believed that with the flood of other complainants, the value of outstanding orders was likely in the hundreds of thousands of rand.
Another customer said she had laid formal complaints about the issue with the National Consumer Commission, the Gauteng Office of Consumer Affairs, and the Companies and Intellectual Property Commission (CIPC).
“I believe they have done this with full knowledge that they would not be able to honour the orders,” she stated.
The customer also directed MyBroadband to the CIPC’s Bizportal enterprise database, which showed Powerbite registered under four legal entities for each of its stores.
Matthews is listed as the sole director for all of them.
None of the entries showed that Powerbite was in business rescue or was being liquidated at the time of publication.
Consumer complaints portal Hellopeter has also been flooded with 1-star reviews between July and August — a big change from the previous months where reviews were generally positive.
Many users reported receiving the same email in updates on their orders, wherein it apologised for its “horrendous service”.
This time, it claimed it was “rocked by armed robberies” and Covid-19 and thus had to apply for business rescue.
“We, therefore, cannot process any refunds or send orders out at this moment until the order has been granted,” it stated.
MyBroadband contacted Powerbite via this email address, and the company confirmed it had been advised to apply for liquidation after considering all other options.
“The application should be filed within this week by our lawyers,” Matthews said.
Matthews also confirmed Powerbite closed down all three of its stores, shuttered its offices, and retrenched 16 employees.
He added the company would use its “limited resources to assist customers who have issues with existing devices as far as possible”.