Major retailers closing their doors

  • Opinion
  • August 22, 2017
  • Paul Keane
Major retailers closing their doors

About two years ago, consumers were receiving signals from Dick Smith Electronics that the company was not trading well. Whilst the rumours continued through to Christmas 2015, customers continued to make purchases from the group stores throughout New Zealand. However by January 2016, it was apparent that Dick Smith would close and with that went the certainty of the retention and value of the Gift Vouchers that had been purchased during the previous Christmas buying spree. Thus all value was lost as a result of that closure.

The recent announcement by JB - Hi Fi management that they were finalising a performance strategy for its New Zealand discount electronics chain, following a sales and margins decline in the last financial year, had a similar ring to it of the Dick Smith saga. Apparently JB HI FI have had about a $2.7 million dollar loss over the past financial year. One doesn't have to be an Einstein to accept that as a signal that JB HI FI may not be about for much longer. In fact they have closed their store at Westgate in Auckland and it must be likely that more will follow.

Just how many retailers have opened and closed just as quickly in this country?

Too many to contemplate, but certainly in the Appliance field there have been the Good Guys and Dick Smith in recent times and the list is likely to be added to through the potential demise of JB HI FI. One assumes that is they do depart NZ that they ensure the exit is tidy and customers are not left out of pocket.

There is always a great deal of fanfare when overseas retailers announce their arrival in this country. The most recent, is the applauded potential arrival of Chemist Warehouse who apparently will take our retail environment to another level!!  Really?  We are well served by Chemists in this country and another group arrival in my view is likely to be overkill.  I recall about 10 years ago that The Warehouse had a group called "Care Chemists". Ultimately the delivery of these stores became just too hard for the Warehouse Group and they closed all the outlets. Similarly, there was great fanfare about Countdown supermarkets having a similar in- store facility. Whilst this has been trialled it would seem that the idea has floundered and few have been developed to a point that they are truly representative in all Countdown supermarkets. 

So why do these overseas companies tend to arrive with a fanfare and leave with few trumpets blaring?

I believe our infrastructure is simply too small to maintain a level of sales and profitability which provides long term viability and security for these companies. Groups of stores are hard to develop and maintain with a population nationally of just on 5 million people, a third of who are in one city.

We as consumers should also be mindful of the need to support our local retailers over those that have a tendency to be "retail carpetbaggers" who come and go with equal speed. I am often reminded that our local retailers support us in the various communities and supporting them over others can be rewarding for all of us. With the potential for Amazon to arrive in New Zealand, competition will continue to increase and with it the need for support of our traditional retailers.

Sharewatch | Micheal Hill International

Michael Hill International has delivered another bonza result for the year. This includes record revenue and EBIT for Australia (now the company’s home base), a truly fair dinkum achievement.

Here in New Zealand, where the company began, Michael Hill continues to excel. It made sales of $122 million, and generated EBIT of $28 million, a record. The New Zealand stores have consistently performed strongly for at least the last six years, a time during which many retailers have struggled.

Michael Hill continues to explore growth opportunities – its Canadian expansion is starting to bear fruit, with revenue now at CAD $113 million and record EBIT of CAD $12.6 million. Admittedly, this is still not as profitable as the New Zealand or Australian operations, but the signs are encouraging.

The smaller US operation, though, continues to disappoint. It has lost money every year, and in 2017 it made a loss of USD $3.8 million on revenue of $12.5 million. This is minor compared to the overall size of the company, but US success seems to be a long way off.

Emma & Roe is a new retail brand for the company, still in its growth stages, and now has 29 stores open with revenue of $15.1 million. Profit remains elusive – with an EBIT loss of $6.9 million – but this is a promising brand, and Michael Hill will take the opportunity to tweak the format as they continue to open stores going forward.

Paul Keane is a registered property professional and has vast experience in New Zealand’s commercial property industries. He provides retail and property consultancy including development management to many New Zealand property owners, developers and city councils. This post originally appeared on RCG's blog.

​ ​

This is a community discussion forum. Comment is free but please respect our rules:

  1. Don’t be abusive or use sweary type words
  2. Don’t break the law: libel, slander and defamatory comments are forbidden
  3. Don’t resort to name-calling, mean-spiritedness, or slagging off
  4. Don’t pretend to be someone else.

If we find you doing these things, your comments will be edited without recourse and you may be asked to go away and reconsider your actions.
We respect the right to free speech and anonymous comments. Don’t abuse the privilege.


Military-style semi-automatics ban announced

  • News
  • March 21, 2019
  • The Register team
Military-style semi-automatics ban announced

As of 3pm on March 21, a wide range of semi-automatic weapons have been reclassified under section 74A(c) of the Arms Act as requiring an E endorsement on a firearms license. This means they can no longer be sold to those with A-category gun licenses, and their purchase now requires police approval.

Read more

Retailers gather for insights at NZ Retail and The Register's breakfast

  • News
  • March 21, 2019
  • The Register
Retailers gather for insights at NZ Retail and The Register's breakfast

NZ Retail and The Register’s sales and marketing breakfast saw dozens of Kiwi retailers come together to network, sharing tips and tricks and absorbing expert advice.

Read more

Who stole Christmas?

  • News
  • March 21, 2019
  • Kelly Withers
Who stole Christmas?

Results are starting to trickle in from Christmas 2018/2019, and for many retailers, they're a little disappointing. Paydar chief executive and co-founder Kelly Withers explores the data.

Read more

Social scoreboard

Zavy and The Register have worked together to create a scoreboard that compares how the top 25 traditional media advertising spenders in New Zealand have performed on social media over the past 30 days, updated in real time.

Concept to closet
Business coverage of New Zealand Fashion Week.
Town centres
A positive retail environment over the past 12 ...
Amazon Arrival
Keeping up with all things Amazon as it ...
The Retail Yearbook 2017
As we battle our way through the busiest ...
Hospitality enhancing retail
Some think food and integrated hospitality offerings will ...
The future is bright
We spoke with four retailers in their twenties ...
Spotlight on signage
At first glance, the humble in-store sign might ...
Red Awards 2016
The Red Awards for retail interior design celebrate ...
Auckland Unitary Plan
Auckland is changing. The Unitary Plan will decide ...
How to open a store
Sarah Dunn considers what it would take to ...
All things to all people
Kiwi retailers share their omnichannel strategies.
Rising stars
Retail's top young achievers.
Delivering on your promises
The sale isn't over until your item is ...
Retail in heartland New Zealand
Retailers keep the regions pumping, but how strong ...
Women in retail help one another. We spoke ...
The changing face of retail
Shifting demographics are creating big changes in New ...
The retail yearbook
With the help of experts in the retail ...
Retail rogues
We put the spotlight on staff training. Jai ...
Here come the giants
Topshop has arrived in Auckland’s CBD, David Jones ...
Window shopping: A spotlight on social media
Sarah Dunn and Elly Strang look at how ...
From retail to e-tail
Ecommerce has become part of the way mainstream ...
Loyalty in the digital age
How are retailers maintaining loyalty? Sarah Dunn, Elly ...
The Innovators | In partnership with Spark Business
Technology is rapidly changing the retail industry as ...

Chinese businesspeople raise millions for Christchurch victims

  • News
  • March 21, 2019
  • Radio New Zealand
Chinese businesspeople raise millions for Christchurch victims

A group of visiting Chinese businesspeople have raised $2.35 million for victims of the Christchurch mass shooting.

Read more

The Retail NZ Awards: What does it take to be a winning retailer?

Take this time to shine with the upcoming Retail NZ awards, a chance to show the retail industry what makes your business stand out. No ...


Hunting & Fishing New Zealand voluntarily pulls military-style assault weapons from sale

  • News
  • March 20, 2019
  • Sarah Dunn
Hunting & Fishing New Zealand voluntarily pulls military-style assault weapons from sale

In the wake of the attack on Christchurch’s Muslim community on March 15, strong calls for changes to New Zealand’s gun last have been made. Trade Me was the first retailer to act, halting the sale of all semi-automatic weapons on its platform, and it has now been joined by Hunting & Fishing New Zealand.

Read more
Next page
Results for
About us.

The Register provides essential industry news and intelligence, updated daily. And the digital newsletter delivers the latest news to your inbox twice a week — for free!

©2009–2015 Tangible Media. All rights reserved.
Use of this site constitutes acceptance of our Privacy policy.

The Register

Content marketing/advertising? Email or call 022 639 3004

View Media Kit