The retailer has entered voluntary administration, blaming global competition, stagnant sales and rising fixed costs. (Westfield)
Menswear retailer Roger David has entered voluntary administration, blaming global competition, stagnant sales and rising fixed costs.
“The company has been exploring all options, including a sale of the business, but has been unable to find an alternative to administration,” said Craig Shepard, a partner at KordaMentha, the administrators.
Roger David has been selling suits and men’s fashion since 1942, and had more than 100 stores at its peak — under its own brand name, RDX and Stray.
Since then, its store count has dwindled to 57, and it currently employs 300 people.
“Today marks a sad day for in the long history of Roger David menswear and for Australian retail,” the company’s directors Courtney Howe and Lauren Thompson said in a joint statement.
They said their understanding is that “the doors will remain open and it will be business as usual for the upcoming peak retail period in an effort to maximise the options for the business.”
“Despite the directors’ best efforts with the business, it simply could not compete with the influx of multinational retailers and the rapid, global evolution of online shopping.”
Although they did not name any specific competitors, Amazon, H&M and Zara are commonly cited as the global retailers that have intensified competition for many local fashion retailers.
What next for Roger David?
Roger David will immediately begin a national closing down sale to “clear stock and raise as much money as possible for employees and other creditors”, KordaMentha wrote in a statement.
“Gift cards will be honoured in full for one month to encourage support from customers for the closing down sale,” KordaMentha said.
The first meeting of creditors is scheduled for October 30.
Roger David is the latest in a long line of retailers that are either struggling or out of business — a category which includes the likes of David Lawrence, Marcs, Oroton, Toys ‘R’ Us, Dick Smith and many others.
Australia’s two major upmarket department stores have also struggled, with Myer trading at 50 cents a share — a fraction of its $4.10 October 2010 float price, and David Jones now owned by South Africa’s Woolworths.
“The continuing absence of real wage growth and increases in the cost of many basic expenses (including mortgage rates) ensures that competition for the discretionary spend of consumers remains high,” he said in a statement to the market.
The Reject Shop’s share price slumped as much as 44 per cent yesterday on a massive profit forecast downgrade due to weak sales.