Harris Scarfe staff are concerned about their future with post-Christmas job prospects in jeopardy
Not only did Harris Scarfe’s private equity owners flip the business into administration after less than a month of ownership, they didn’t even tell staff before it happened.
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Harris Scarfe staff had to find out from customers that the business had been placed in administration on Wednesday, before management called them in to break the bad news.
Allegro Funds, which bought the business last month and then placed Harris Scarfe and its 66 stores across the nation into administration a few short weeks later, refused to answer questions from The Advertiser about why it had done so.
The Advertiser spoke to a staff member on Thursday, who had to remain anonymous as the receivers, Deloitte, have directed staff not to speak to the media.
The woman, who has been with the company for about a decade, said it was a blow to workers who now did not have job security beyond the immediate Christmas and post-Christmas sales period.
“We work as a family at Harris Scarfe. Now we’re all feeling really low, we’re pretty upset,’’ she said.
“To think that we may not be there in six weeks’ time and trying to find something else is pretty difficult.’’
Having just been bought by Allegro last month, the woman said staff had hoped that their job security would have improved, if anything.
She said staff would now have to try to keep their chins up and work hard through the busy Christmas period, with no guarantee of a job on the other side.
“A lot of us have families. Not knowing after Christmas, it’s very hard.’’
Deloitte said there would be little clarity about future steps for the business, which they are hoping to sell as a going concern, until the New Year.
Deloitte did confirm that the business was not profitable last financial year, with some parts of the business doing better than others. Harris Scarfe gift cards are being honoured and Deloitte said there were no changes planned to the Christmas sales strategy.
Josh Peak, secretary of the Shop, Distributive and Allied Employees Association said it wasn’t the first time private equity owners had run into trouble in retail and an explanation of why the company was so quickly sold should be forthcoming.
The Dick Smith retail chain notoriously failed in 2016 with the closure of more than 360 stores after a disastrous share market float orchestrated by Anchorage Capital.
Hindmarsh-based Ed Harry failed in January, with the loss of more than 100 jobs in SA, while online footwear trailblazer Shoes of Prey also met its demise in March.
Harris Scarfe is SA’s oldest retail chain and was started as a hardware business in 1849.