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Marcs and David Lawrence tank in Australia and NZ

 

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Retail fashion labels David Lawrence and Marcs in Australia and New Zealand have gone into voluntary administration after suffering deteriorating sales, poor cash flow and tough market conditions.

Insolvency firm Rodgers Reidy have been appointed by the combined companies that operate Marcs and David Lawrence, Jigsaw founder Malcolm West’s M. Webster Holdings Pty Limited, Webster Holdings NZ Limited and Webster Asset Pty Limited.

The shops will stay open while the administrators conduct a review.

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Possible outcomes include returning the company to the directors’ control; selling the company outright; restructuring and selling the company or liquidating it if a buyer can’t be found.

Rodgers Reidy told Fairfax that finding a buyer was a good possibility, given the reputation of both brands, but it was likely that there would be some job losses and store closures.

Director Geoffrey Reidy told Fairfax: “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 rationalised business, be it Marcs and or David Lawrence to be offered to a potential buyer.”

The downfall of Marcs and David Lawrence has dealt another blow to the Australian fashion industry, which has already lost children’s fashion retailers Pumpkin Patch and Payless Shoes.

Last year was a horror year for other major retail players, Dick Smith spectacularly collapsed in January 2016, followed by Howards Storage World in December 2016 and Woolworth’s Masters hardware and DIY chain the same month.

Most cited competition from online retailers, lightening fast changes in consumer demand patterns; falling sales and a dwindling market share as the main reasons for failure.

The impact of David Lawrence and Marcs going under is not insignificant. The two fashion labels had 52 stand-alone stores, 11 outlets and over 140 concession stores operating out of Australia and New Zealand, including Myer and David Jones.

In Australia alone the companies employ around 1,130 staff. Of these, 640 staff are casuals, 260 staff are full-time basis and 230 work part-time. There are 10 stores in New Zealand employing 42 staff.

The Administrators said staff wages had been paid up until January 30, 2017 and superannuation until December 31, 2016.

All existing gift cards and returns will be handled in accordance with the companies’ existing policies.

Geoffrey Reidy, Director of Rodgers Reidy said: “We intend to review the operations of the businesses and continue to trade while we market the businesses for sale.”

The Administrators will later announce the date and time of the first meeting of creditors.

David Lawrence was established in 1978 with an emphasis on style, good quality fabrics and simplicity.

Very much geared to working women, the David Lawrence woman was described as being “a sophisticated woman’s woman who knows her own sense of style; she wants versatile solutions for workwear and smart casual dressing that cater to her busy lifestyle”.

The first store was in Collins Street, Melbourne.

Mark Keighery first launched Marcs in 1979, initially showcasing classic men’s shirts but later expanding the range to good quality basics in tops, pants and knitwear, with an accent on European style.

More to follow.

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