Hello, Boils and Ghouls! We’ve got a spooktacular NIB special for you this week, looking at ghoulish stories of New Zealand retail – brands that met an untimely end; brands that came back to life as zombie retailers; or vampire brands that sucked the life out of others. Read on, if you dare!
Before the horror begins, we need to start with an appropriate disclaimer. Overall, New Zealand’s retail sector is in good shape. Various figures from Stats NZ show that the sector has $78 billion in annual sales, with more than 200,000 retail jobs across the country, and that retail employees worked 23 million hours in the last year (a record). Add in the “accommodation and food service” sector, and the numbers would be even higher.
Those jobs and hours take place across 35,000 stores, so it’s not surprising that each year we hear tales of store closures. Now gather around the campfire, as we share some of these fiendish tales…
These brands have fiendishly sucked the life out of another brand. Outside of Halloween season, this would probably be referred to as a “rebranding”, “consolidation”, or “mergers and acquisitions”, but where’s the fun in that?
- Countdown: absorbed the life force of Foodtown and Woolworths supermarkets, with all three brands consolidated into one.
- Noel Leeming: did the same for Bond and Bond (and more recently for Appliance Shed).
- JB Hi Fi: expanded into New Zealand by buying Hill & Stewart, which it operated in pod-person-like fashion for a very short time before rebranding them as JB, or closing them.
- Budget Eyewear: global eyewear manufacturer Luxottica shut down its short-lived Budget Eyewear chain so it could focus on OPSM, with some of the stores rebranding. Spooky!
You can protect yourself against vampire retailers using garlic, which you can pick up at Countdown. While you’re there, you could also buy some steaks.
These retailers were once thought dead, but have spookily risen from the grave to walk again! At other times of year, this might be called a “receivership or liquidation with sale of assets and intellectual property”.
- Postie Plus: entered voluntary administration in 2014; bought by Pepkor, a South African retail group.
- Whitcoulls: administration in 2011, bought by James Pascoe Group. Borders, which had formed part of the same group, was put to sleep.
- Banks Group: the operator of Shoe Connection and Banks Shoes grew too fast and went into receivership in 2017 – but was jolted back to life.
- Wendy’s Supa Sundaes: in a fiendish tale of intrigue and suspense, these stores attempted to cut ties with their franchisor in 2018, rebranding as Shake Shed. They were given a clip round the ear in court, and have now reverted to the Wendy’s brand.
You can protect yourself against zombie retailers by walking away at a medium pace.
Franchise businesses have many heads – with each store often individually owned – and often, franchisees can close their doors with the parent brand remaining intact. This is normal for any franchise chain – they’re all hydras.
In some cases, even the parent brand or franchisor can run into difficulties but live to fight again. Some examples include Nandos and Hardy’s. We’re not sure what to call this, but it’s pretty spooky!
Resting in Peace
We’ve assembled a non-exhaustive list of retail chains that have bitten the dust in the last 5 years. You’ll notice a number of fashion brands here. These are often the highest-profile names to disappear. Although many blame the spectre of online retailing, fashion failures are often due to cashflow issues, underinvestment in the retail experience, or failing to adapt to changing consumer trends. Or possibly werewolves.
Dogs Breakfast Trading Company
Eastern Hi Fi
Emma & Roe
Kirkcaldie & Stains
Marcs/ David Lawrence
Resting Less Easily
- Pumpkin Patch: liquidated with all stores closing. But Ezibuy has bought the brand, and is selling Pumpkin Patch-branded products through its stores, with the potential for standalone stores in future.
- Dick Smith, which collapsed in 2016. Australian online retailer Kogan.com bought the online brand and continues to sell from dicksmith.co.nz. A ghost retailer perhaps?
- Nosh, which like Rasputin took several goes before finally dying!
So what can retailers do to protect themselves, and keep their names off this list? Make sure they’ve got the best braaaaiiiinnnnnsssss, and keep moving quickly – not like mummies or classic zombies. Maintain a clear brand proposition and product range – don’t let your stores become a Frankenstein’s monster of mismatched parts. Happy Halloween everyone!
In the Press
Local Media highlights from the past week...
October is ending with yet another rate cut from a major bank.
BNZ is matching ANZ with a 4.15% one year fixed carded rate.
S&P Global Ratings revised its risk trend on New Zealand to positive from stable after housing-related imbalances in the economy moderated.
"We are revising our economic risk trend to positive given our view that the risks facing New Zealand's financial system have stabilised. This reflects a slowdown in the rapid rate of growth in residential house prices and private sector credit extension as the credit cycle matures," the ratings company said.
The waterfront stadium debate bubbles up once every couple of months in Auckland. But why has the debate over a waterfront university never resurfaced, asks editor of Interest.co.nz Gareth Vaughan?
A group of Auckland business interests has come up with the latest proposal for an Auckland Waterfront Stadium.
The number of new homes consented took a breather in September, with new dwelling consents down 7.6% compared to September last year.
Statistics NZ said 2559 new dwellings were consented throughout the country in September, compared to 3075 in August and 2770 in September last year.