The two Australian fashion retailers David Lawrence and Marcs have been put into administration. As the brand’s sole director Malcolm Webster said, is was a necessary step because of a poor cash flow, market conditions, as well as decreasing sales.
The news is quite shocking though because the brands have been very popular among celebrities, such as Zoe Ventoura or Rebecca Maddern, who wore their pieces on TV and the red carpet. Furthermore, the labels have established a huge base in Australia and New Zealand with 52 stores, 11 outlets and 140 concession stores.
So what led to this negative development and debts of close to $30 million? Is it because European giants Zara and H&M entered the Australian market and take away their already existing, as well as new customers?
But whatever reasons led their losses, administrator Rodger Reidy’s director Geoffrey Reidy stated that both brands won’t stop trading immediately and that his team is reviewing their operations until the sale of both businesses, which would hinder a liquidation, the worst-case-scenario:
“The alternative is for a sale and restructure of the company… and the third outcome is that we can’t find a buyer and the company goes into liquidation,” he continues, “we believe these is real potential to deal with the cost side of things, in terms of the company operation and to enable a consolidation or rationalized business, be it Marcs and or David Lawrence to be offered to a potential buyer.”