Jeanswest hit by ‘perfect storm’ as ’90s fashion staple calls time on brick-and-mortar stores

The collapse of ’90s denim staple Jeanswest has been blamed on a “perfect storm” of factors wreaking havoc on the fashion sector.

The collapse of ’90s denim staple Jeanswest has been blamed on a “perfect storm” of factors that has already led to thousands of job losses across Australia’s fashion sector.

On Wednesday, the company behind the iconic fashion brand called in administrators to wind up the company’s 90 bricks-and-mortar stores, with 600 jobs set to go.

It comes on the heels of Ally Fashion being ordered into liquidation last month, costing 250 jobs, and follows last year’s collapse of Mosaic brands, which led to more than 3000 job losses across stores including Katies, Millers, Rockmans and Rivers.

QUT marketing expert Professor Gary Mortimer said the “nostalgic” factor could not save the brand.

“I remember growing up in the ’80s and ’90s and shopping and Jeanswest )when it was called) Eagle Jeans. The issue with nostalgia of course is people who grew up in the ’80s and ’90s are now in their 50s and 60s and aren’t buying that product any longer, and the new generations are shopping elsewhere.”

Prof Mortimer said Jeanswest, the latest in a string of high-profile fashion retailers to go under in recent years, had been hit by a “combination of factors” including a crowded market and the cost-of-living crisis.

Jeanswest has collapsed into voluntary administration. Picture: Supplied

“It’s the perfect storm,” he said.

“Older, mid-tier fashion brands don’t really have a point of difference between them. I can buy men’s chinos in about five different retailers including the discount department stores. It’s an increasingly competitive market where you’ve got 10 to 20 of these same types of stores in every shopping centre.”

Fast-fashion retailers like Uniqlo and Zara, which entered the market in the early 2000s, had already taken much of the younger demographic, and more recently cheap online retailers like Temu and Shein were “slowly, yet aggressively, capturing market share”.

“I think if you asked an 18-year-old or 19-year-old today if Jeanswest is cool they would say no,” Prof Mortimer said.

Prof Mortimer said the latest announcement “must be keeping shopping centre management awake at night”, with total vacant tenancies now at around 850.

Similarly Myer should be worried, considering its exposure to Just Group brands Dotti, JayJays and Just Jeans.

QUT Professor Gary Mortimer. Picture: Supplied

He pointed to the closure of Roger David’s 57 stores in 2018. A month later, Ed Harry menswear announced all 87 outlets would close.

“The sales Ed Harry expected to come during the busy Christmas trading period didn’t materialise, as shoppers took advantage of Roger David’s ‘slash and burn’ sale,” he noted.

Prof Mortimer said the “human element” of nearly 4000 job losses since last year was often overlooked.

“They don’t know how they are going to pay the rent, mortgage or bills,” he said.

“A senior executive, maybe a buyer may be lucky to get a job with the likes of Wesfarmers or Woolworths Group buying again, but a store manager of a small fashion chain I think they’ll struggle. Where do they go?”

Harbour Guidance Pty Ltd, which rescued Jeanswest after it previously entered administration in 2020, made the decision to put the company into voluntary administration on Wednesday, appointing Lindsay Bainbridge, Andrew Yeo and David Vasudevan of Pitcher Partners Melbourne.

‘The new generations are shopping elsewhere.’ Picture: Supplied

The company said it was it was calling time on its bricks-and-mortar operations as trading conditions for Australian retailers become increasingly tough amid reduced discretionary spending and increased cost of living.

Pitcher Partners said while the physical stores were set to close, the brand and online store may be continue and all restructuring options remain open.

Mr Bainbridge said the company had fought for five years to revive the 53-year-old brand but had concluded it was time to step back from physical stores to focus on online retail.

“The owners have done everything they can to keep Jeanswest going, but market conditions mean sustaining bricks-and-mortar stores is not viable and unlikely to improve,” he said in a statement.

“They deeply regret the impact of store closures on their team members and their customers, and we will be working now with teams across the country.”

Mr Bainbridge acknowledged the impact of the decision on staff.

“This is a hard day for hundreds of Jeanswest team members and we will be working directly with the team members to provide clarity and information about the next steps,” he said.

Mr Bainbridge said he expected all store stock to go on immediate sale as the administrators began the process of restructuring the business.

“We will be opening the doors of all stores and selling online to clear all stock to secure a return to creditors,” he said.

A first meeting of creditors will be held virtually on April 4.