In short:
David Jones's receivers are set to close 19 of its 38 stores.
asserted
receivers → set → stores
Suppliers say they are sad but supportive of the decision.
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they → say → decision
The affected stores are expected to continue trading through the peak seasonal period.
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stores → expect → period
While news of David Jones's plans to close half of its stores may sadden some customers, some suppliers say a streamlined operation could boost sales by encouraging more shoppers into fewer, higher-performing stores.
uncertain
operation → close → stores
The 188-year-old department store went into administration last week.
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store → go → administration
On Wednesday, its receivers announced plans to close 19 of its 38 stores.
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receivers → announce → stores
Owner of Spice brand Lord and Lion, Eresha De Zoysa, which has been stocked in the entire David Jones network for five years, said she was concerned the closures would wipe a significant amount of her business.
"The way that we were able to access people in communities that we ordinarily would not be able to access was by David Jones," she said.
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she → stock → Jones
"So even though, on the whole, those stores may not make commercial sense for Anchorage to keep or David Jones to keep … our brand did really well, and we were successful in those stores.
uncertain
we → make → stores
It's a sad day, but I think we just have to be a bit more clever in how we're going to access [those customers]."
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we → think → customers
Documents seen by the ABC show an uncertain future for suppliers which have been asked to continue supplying the store despite unpaid debts.
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which → see → debts
Ms De Zoysa, a former corporate lawyer who has worked in administration and previously advised David Jones, said she had no doubt
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she → work → Jones
a restructured David Jones would succeed and thrive
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Jones → restructure → ?
"I do hope that the suppliers find a way to renegotiate an outcome with David Jones to continue supplying into the future because it is actually those brands that make David Jones worthwhile," she said.
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she → hope → future
David Jones 'could not continue operating'
uncertain
Jones → continue → ?
McGrath Nicol has been appointed administrator for David Jones, but separately FTI Consulting has been appointed as receiver for the company's biggest lender, Hilco.
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Consulting → appoint → lender
An email sent to suppliers from David Jones chief executive Erica Berchtold, seen by the ABC, said the store portfolio was "no longer the right shape for the business" and the change was about "creating a network that is financially sustainable for the future."
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that → send → future
It said the last day of trade for the 19 stores it was closing was anticipated for later in the year, with the stores expected to continue trading through the peak seasonal period.
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stores → say → period
"The business could not continue operating as it was.
uncertain
it → continue → ?
We had a plan to reset the business, and we still have a plan to reset the business," the email said.
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email → have → business
Carlos Martins, owner of men's fashion brand Coast Clothing, said the store closures were the "right way forward".
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closures → say → brand
"Fewer stores will be better for me in the long term," he said.
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he → say → term
"Loyal customers will likely shift to online shopping, which will bring greater exposure to my brand, compared to instore where we didn't have a presence."
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we → shift → presence
Jacob Leung, owner of handwoven blankets business Slowdown Studio, which is not stocked in the closing stores, said although the news was sad, it was good for suppliers.
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it → stock → suppliers
"It's going to have a massive impact on all of those employees, as well as the communities of the stores that are closing down," he said.
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he → go → stores
"We only want the best for David Jones because if they're winning, that means we're winning.
"
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we → want → Jones
At the end of the day though, it's clear that the business model that David Jones currently operates in is not working, and that's why we are all in this situation.
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we → operate → situation
Focus needs to shift to service
Mahala Joyce, co-founder and director of distribution business Over The Fence, has organised pop-ups in David Jones flagship stores for international brands, including Bellroy and Topologie.
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Joyce → need → Bellroy
Like other suppliers, he said he had negotiated 14-day settlement terms that came with a 5.75 per cent discount.
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that → say → discount
Yet across three purchase orders over six months, he said none was paid on time, but the discount was still applied.
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discount → say → time
Relevant documents have been seen by the ABC.
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documents → see → ABC
"Essentially the way that their system is set up is it's set up that those discounts are applied at the start, prior to any payment date," he said.
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he → set → date
Mr Joyce said the decision to close David Jones stores was the right move.
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decision → say → stores
"It's surprising that no-one within their leadership saw that that was a thing that they should have done prior,"he said.
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they → see → that
"It was broadly known that there were a number of locations, about 19, that were loss-making.
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that → know → locations
And a lot of the people that I spoke to in that business thought that if they had 12 stores in the long run, that that would be a very solid business for them to be able to kind of go forward with."
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them → speak → run
However, he said David Jones needed to focus on fixing its customer service.
"
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Jones → say → service
They can close stores, they can repair relationships with vendors, but until they actually start delivering on the promise, like the service promise that their brand has developed in Australia, even with the store closures, I think it's going to be a tough market for them.
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it → close → them
"But if they can deliver on those promises that consumers expect from them, then I think they can be a really strong player in the retail landscape."
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they → deliver → landscape
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