res can be a blessing and a curse, or an asset and a liability, as demonstrated by the recent events of Mosaic and Premier. “Australia’s rag trade continues to navigate challenging waters, but that’s retail,” Nick Gray, the founder of I Got You Consultancy, told Inside Retail. “Right now, we’re dealing with financial strain, ongoing changes in consumer habits, and increased online competition.”  Pulling the curtain back Only four weeks before entering into voluntary administration, Mosaic announced it would be winding down five brands, Autograph, Rockmans, Crossroads, W Lane and BeMe, which its CEO Erica Berchtold described as “marginal and non-core”. Now, Mosaic’s presumably ‘core brands’, Millers, Noni B, Rivers and Katies, are also on the chopping block as the retail group looks to accelerate its rationalisation plan and attract new customers across metropolitan and regional Australia through the administration process. “Mosaic’s voluntary administration and store closures reflect the high-pressure environment for profitability, especially for those with high fixed costs,” stated Gray. But according to Mosaic Group’s CEO Erica Berchtold, all is not lost; rather, it is an opportunity for transformational change. “Mosaic Brands continues to be an exciting opportunity to reshape a business with a clearly defined market proposition for its target customers, and employees, that we can be proud of,” Berchtold said in a statement. In the same week that Mosaic announced its voluntary administration status, Myer announced its acquisition of Premier’s Apparel Brands, which includes Jay Jays, Dotti, Jacqui E, Just Jeans and Portmans. “The combination of Myer and Apparel Brands is transformational for our business,” said Myer’s executive chair, Olivia Wirth, in a statement. “If approved by shareholders, it will create a leading retail group with more than 780 stores across Australia and New Zealand, with a large and highly engaged customer base and capital to fund future investment and growth,” she added. Finding the crown jewel  For many retail experts, retail stores are still the crown jewel of the rag trade – it’s where brands curate for and connect with their customers. For Gray, bricks-and-mortar stores continue to be an asset, especially for apparel retailers, where sensory engagement enhances the experience, but brands need to be clear on their positioning. “Today’s retail landscape has two camps: cognitive defaults, like Rebel Sports for sports gear, where customers purchase automatically and make fast decisions on where they go to purchase, and emotional defaults, where purchases are driven by the emotional connection or feeling towards the brand or business,” explained Gray. “Any retailer unclear about their positioning will have limited time left in my opinion. Retailers must be clearer than ever about the feeling they’re selling – not just the product,” he added. If physical stores are meant to be the embodiment of a rag trader’s brand, any absence of identity and vision will be on display for customers alongside the racks of clothing. “Today, a physical presence is a brand’s most manageable, tangible, and measurable marketing tool,” Gray reaffirmed. “There is no better place to meet a customer regardless of where they are on their journey – meeting them for the first time, providing education or inspiration for allowing them to purchase for the first or third time,” he added. While the industry can agree on the necessity of a physical presence for retailers operating in the apparel space, the jury is still out on the optimal number of locations for brands to maintain relevance and succeed. “We all grew up with a shop on every corner. Scale is very important, but I think coverage replaces scale,” Brian Walker, CEO of Retail Doctor Group, told Inside Retail. “It’s more about being a really proficient omnichannel retailer now; it’s probably less about the sheer number of stores, probably much more around the quality of the offer.” But according to Walker, even for an omnichannel retailer, the principles of success remain the same: innovation of product, uniqueness of offer, understanding your customer and then being able to deploy it in a fast and efficient way. “You can’t have large scale and be vanilla,” stated Walker, adding, “It’s less about building many, many shops – it’s about building the right ones, the right locations, and then it’s about mobility in the physical experience [such as] pop-ups.” For Walker, this is where Mosaic Group’s brands have gone wrong. However, while the immediate future of the business is uncertain, given the strong management, he is confident the retail group will reemerge “in some way, shape or form”.