Retail

Is Kmart to blame for Pumpkin Patch’s downfall?

Emma Koehn /

The “stratospheric” rise of Kmart in the children’s clothing space was a driving factor in the fate of collapsed retailer Pumpkin Patch, according to new data on Australian spending habits.

Roy Morgan research into the children’s clothing space, released this week, has found customer sentiment towards the Pumpkin Patch brand has remained strong over the past three years, but the number of shoppers turning to Aldi, Zara and H&M for kidswear could have drawn as many as 95,000 shoppers away from Pumpkin Patch each month.

Read more: Seven Pumpkin Patch stores to close as sale process continues

Cotton On Kids only recently overtook Pumpkin Patch in customer numbers, hitting 133,000 average shoppers versus 128,000 for Pumpkin Patch over an average four week period, while Kmart increased its shoppers in this segment 27% since 2014.

Pumpkin Patch is listed on the New Zealand stock exchange and collapsed in October after it became unable to find a solution to service its $NZ46 million ($43 million) in debts.

At the time retail experts told SmartCompany the business had struggled to differentiate itself from discount department store offerings and affordable, designer-style children’s accessories and clothing now available in the local market. Seven New Zealand Pumpkin Patch stores have now closed as receivers KordaMentha work to make the business as attractive a proposition as possible to potential buyers.

The brand has 117 Australian stores which will continue to trade while the business is in receivership.

The Roy Morgan research suggests the brand is not the only one to feel the heat from new entrants: Best & Less, Target and Big W have seen declining customer numbers over the past 12 months, with Kmart the only retailer to experience a strong upswing.

Customers of the New Zealand Pumpkin Patch stores have taken to social media this week to thank staff for their service, particularly when shopping with children.

“Really sad that Pumpkin Patch will be leaving NZ. I grew up wearing Pumpkin Patch clothes and now my little girl has worn them. I love the quality and love how cute and girly they are,” said one shopper in farewell to the store.

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Emma Koehn

Emma Koehn is a former senior SmartCompany journalist.

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