Published
Jul 10, 2017
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Topshop closes five Australian stores to save overall business

Published
Jul 10, 2017

Topshop’s administrator in Australia is taking drastic action to save the business with as many as five of its nine standalone stores closing.


Topshop



It has already shuttered four locations but the fifth closure is more of a surprise with its very first location in the country about to be axed. That's the Chapel Street store in South Yarra, which opened as far back as 2011 and was reported to have had a very successful debut period.

It has launched a closing-down sale and is set to shut its doors for the final time within the next fortnight.

Topshop’s local franchisee, Austradia, was placed into voluntary administration in May as its debt load reached A$35 million.

While it had suffered from intense competition in the country, local press reports also quoted Hilton Seskin, the retail entrepreneur who controlled Austradia, saying that his company had little control over the inventory that he was selling.

Instead of using a model whereby goods would be designed for the local market, manufactured in relatively nearby Asian factories and delivered direct, they would be made in Asia then sent to the UK and bought-in from there, with the British business largely controlling what was sent.

This model is likely to have created extra costs and complications for the Australian arm.

Seskin also complained that quality and trend levels were low, and that this dented the brand’s appeal, despite the business having got off to a flying start earlier this decade.

It is still unclear what is happening to Myer’s 20% stake in the Australian business. The department store giant hosts 17 Topshop concessions in its stores but has not commented on its intentions.

There has been no comment either from the New Zealand business, which observers said is likely to be using the same model as the Australian one. There are two stores in that country, in Wellington and Auckland, with a second Auckland location and a Christchurch store believed to be planned.

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