Unable to find a buyer, Roger David is shutting down for good
Thursday, November 15, 2018/
After over three-quarters of a century selling menswear to Australian shoppers, retailer Roger David will sell its final shirt in the coming weeks.
The chain is shutting down after falling into administration last month and will be consigned to a fast-growing retail graveyard that includes other recent casualties like Toys ‘R’ Us.
Roger David’s administrators KordaMentha broke news of the company’s imminent demise on this morning, saying they had failed to find a buyer for the business, despite an outpouring of community support in recent weeks.
“Everyone recognised the strength and the affection for the brand, but it did not pass the viability test,” administrator Craig Shepard said in a statement.
There will be as many as 500 Australians out of a job when the chain closes its 57 stores in mid-December, including 300 full-time staff.
Shepard is confident outstanding employee entitlements will be able to be paid with the proceeds of an ongoing fire sale if the pace of stock clearance continues on its current trajectory.
A second creditors report into the state of the business is due out next week, which will provide more detail on the amount of money owed to workers and other creditors.
Administrators increased their store-wide discount from 50% to 60% in a bid to hasten the speed of the stock clearance.
Roger David isn’t the first prominent apparel and accessories retailer to fall into administration in recent years, others like Oroton Group, Surfstitch and Pumpkin Patch have also fallen on tough times.
In those cases, buyers came forward to save the businesses, but amid ongoing pessimism about the future of legacy bricks-and-mortar retail in Australia, it appears the market has little appetite remaining for distressed retail assets.
Subdued consumer demand, rising fixed costs (rent) and competition from global competitors drove Roger David to its end, Shepard reiterated on Thursday.
Started 76 years ago, the chain was one of the oldest menswear brands in Australia, but as has been the case with many legacy retailers, it struggled to keep up with the pace of change demanded by the 21st-century consumer.
University of Tasmania’s retail expert Louise Grimmer put the failure of the business down to what she called “bland land” in an interview with SmartCompany last month.
“A lot of these middle-of-the-road fashion retailers are really struggling, they haven’t got a compelling product offering,” Grimmer explained.
The other big factor is rental cost, an area of longstanding difficulty for most retailers that has become an even more pronounced problem in recent years as trading conditions have become more difficult.
Aside from just being a growing cost imposed on retailers, rising rents also inhibit the flexibility needed to change, as business adviser Stefan Kazakis has told SmartCompany.
“You’re dead in the water before you start,” he said of Roger David’s collapse last month.
“If you couple [rents] with the strategy of discounting every day you’re left with no gross margin and no cash.”