There was much excitement in the fashion industry when Topshop launched in Australia in 2011. But on Thursday, the retailers’ nine stand-alone stores, 17 Myer concessions and online business were all under review as the company was placed in voluntary administration.
The fast-fashion chain has 760 employees and annual sales of approximately $90m.
Restructuring firm Ferrier Hodgson was appointed on Wednesday night by the board of Austradia, the Australian franchisee of Topshop Topman. Austradia is headed up by Rebel Sport’s founder, Hilton Seskin, while the Topshop Topman brand is owned by the British retail giant Arcadia.
In a statement overnight, administrator James Stewart said the company was considering “its optimal operating structure” with all parts of the business to be reviewed. It was unclear how long the process would take.
Topshop was one of the first international fast-fashion brands to launch into the Australian fashion market, along with Spanish brand Zara and US brand Gap, in 2011. Other well-known fashion brands including H&M, Uniqlo and Muji quickly followed.
The influx of international fashion brands has often been cited as part of the reason for the turbulence in the sector, with a number of local brands including David Lawrence, Marcs, Herringbone, Rhodes & Beckett and children’s brand Pumpkin Patch recently closing stores or facing insolvency.
In 2015 Topshop announced an exclusive partnership with Myer department stores. To secure the exclusive department store rights in Australia, Myer made a 25% investment into the Austradia business at the time. This was later reduced to 20%.
A Myer spokesperson said on Thursday it had been pleased with the performance of the Topshop and Topman brands in its stores, and with the “positive impact” the brands had had, particularly in the youth category.
For Topshop employees, Thursday was “business as usual”, with a spokesman for the administrator saying staff entitlements would be protected.
Arcadia has faced turbulent times in the UK. In March, Sir Philip Green, the head of the UK fashion group, agreed to pump up to £50m a year into the company pension fund. Arcadia had been the previous owner of BHS stores, which went into administration in April 2016, just 13 months after Green sold it. This led to the loss of 11,000 jobs and left a pension deficit assessed at the most pessimistic measure as £571m. There was a high-profile UK parliamentary investigation into the demise of BHS stores in 2016.
With Australian Associated Press