Smiggle owner closes Melbourne stores in second lockdown

Image of Premier Investments leadership
Premier Investments CEO Mark McInnes and chair Solomon Lew

Premier Investments is the first major retail business to confirm the closure of stores in parts of Victoria where stage 3 restrictions went back into effect on Wednesday, July 8.

The private company, which owns and operates Smiggle, Peter Alexander, Just Jeans, Jay Jays, Dotti and Jacqui E, issued a statement yesterday, saying its brands are “clearly not an essential service” and closing stores was the “right thing” to do.

“The Premier [Daniel Andrews] has made clear that the livelihoods of all Victorians relies on everyone doing the right thing,” the company said in its statement. “As loved as our brands are by our customers, they are clearly not an essential service.”

The company has closed stores in 36 shopping centres and seven strip malls in metropolitan Melbourne, one of two areas in Victoria that are back in lockdown, for the foreseeable future.

The distribution centre and support office remain open, and customers can continue to shop online across all brands.

However, all metropolitan Melbourne store staff who are eligible for JobKeeper have been stood down, with access to leave entitlements, and the company does not intend to pay rent for the affected stores for the duration of the lockdown.

Same approach for some

This mirrors the approach Premier Investments took nationwide during the first lockdown in April and early May, alongside hundreds of other retailers, including Myer, Accent Group and Kathmandu.

But few on that long list of retailers that closed three months ago have followed Premier’s lead in closing stores for the second lockdown in Melbourne.

Myer, Accent Group and Kathmandu have not made any public statements about store closures in the affected areas, and did not reply to requests for comment.

Country Road, which closed during the first lockdown, has closed one store at GPT’s Highpoint shopping centre, but appears to be keeping other stores open.

Roughly 50 per cent of stores at Highpoint, which is located in one of the “hot spot” postcodes that went into lockdown a week before metropolitan Melbourne, are understood to be closed, including Sephora, Zara and Apple.

“The level of distress among retailers is real, and while most are allowed to open under the current lockdown rules, none of the fundamentals for bricks-and-mortar work when you haven’t got foot traffic, and you have reluctance of staff in being in store if they think they are at risk,” said Brendan Britten, managing partner at advisory services firm Pitcher Partner.

Why they closed

Innisfree, a South Korean beauty retailer, which operates 10 bricks-and-mortar stores in Australia, including one at Highpoint, made the decision to close its Melbourne stores “to help support the community and as a safety precaution for their customers, staff and the broader community”, according to a company spokesperson. The retailer closed all stores during the first lockdown.

That’s also the case for Melbourne bookstore chain Readings, which has closed stores to the public again, except for a location at Westfield Doncaster, which will remain open with limited trading hours.

“Staff are still not comfortable having a lot of contact with people, and we appreciate that,” Mark Rubbo, Readings’ managing director, told Inside Retail.

In making the decision to shut down, Rubbo said he was “very conscious that things actually seem to be worse than when we locked down last time”.

What stage 3 means

Stage 3 restrictions mean there are only four reasons for people to leave their home: to buy food and other essential items, provide care or receive medical treatment, exercise and work or study if unable to do so remotely.

The restrictions apply to metropolitan Melbourne and Mitchell Shire, an area north of Melbourne, and will remain in place for at least the next six weeks.

Many businesses that had just reopened, including restaurants, cafes, pubs, beauty salons, gyms and cinemas, have either had to close or return to takeaway and delivery only.


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