Fashion retailer Colette by Colette Hayman is the latest victim of the unforgiving retail environment having entered voluntary administration a few days after Jeanswest confirmed the closure of a quarter of its stores.
The bags, jewellery and accessories retailer entered voluntary administration on 31 January and has since been put in the hands of Deloitte administrators Vaughan Strawbridge, Sam Marsden and Jason Tracy.
This marks the fourth high-profile retail collapse in the last few months, with Jeanswest announcing in late January it is shutting a quarter of its stores as part of the restructuring process geared towards attracting new owners. Prior to this, department store Harris Scarfe and Co-op Bookshops also announced their collapse.
According to Mr Strawbridge, Colette by Colette Hayman is the latest victim of the current retail environment.
“Colette By Colette Hayman has, unfortunately, been impacted by the current weak retail environment, as have many others,” he said in a statement on Tuesday.
According to Mr Strawbridge, their focus will now be on continuing to trade the business while they seeks either a recapitalisation of the group or a sale of the business.
“Given the strength of the brand, we are confident we will be able to secure a future for the business and preserve the employment of as many people as possible.”
Mr Strawbridge said that, as trading continues, employees will continue to be paid by the administrators. He said he was also confident there are sufficient assets to meet all employees entitlements.
Founded in Australia in 2010, Colette By Colette Hayman operates across 140 stores in Australia and in New Zealand as a destination for bags, jewellery and accessories. The business employs over 300 permanent staff, plus casuals, with annual gross sales of over $140 million.
The first meeting of creditors will be held on 12 February.
'Situation to persist'
Andrew Spring, a partner at insolvency firm Jirsch Sutherland, recently opined that retail failures “aren’t new”, but that the situation is likely to persist without significant reform of how retailers manage their businesses.
“Retail is a tough environment to be successful in over the long term,” Mr Spring said.
Mr Spring’s comments came just weeks after the Australian Small Business and Family Enterprise Ombudsman (ASBFEO) released an interim report into its Insolvency Practices Inquiry, which criticised administrators and insolvency practitioners for their fees and perceived lack of transparency, stating that “the current system appears self-defeating, as the costs of a voluntary administration often consume or exceed the assets of the company”.
Maja Garaca Djurdjevic is the editor of My Business.
Maja has an extensive career as a journalist across finance, business and market intelligence. Prior to joining Momentum Media, Maja spent several years unravelling social, political and economic intricacies in Eastern Europe.