Online fashion brand founded by Australian influencer collapses
A popular online fashion brand founded by an Aussie social media star with 1.5 million followers has collapsed, blaming the Covid-19 pandemic.
A popular Australian e-commerce eyewear brand has collapsed owing $2.3 million because of tough market conditions brought about by the Covid-19 pandemic.
Late on Thursday, online retailer Soda Shades - which is sold on The Iconic - went into voluntary administration, with Rahul Goyal and Kate Conneely of KordaMentha Restructuring appointed as administrators.
The company was founded four years ago, in 2018, by social media influencer and entrepreneur Steph Claire Smith and her partner Josh Miller.
On Instagram, Steph Claire Smith boasts a following of 1.5 million people.
It’s understood these founders are no longer involved in the company and had passed it onto investors by the time the retailer went under.
One of the joint administrators, Mr Goyal, said: “Unfortunately, the business came unstuck due to supply chain issues”.
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The administrators are looking to sell the company to better pay back debts.
“We expect there will be a high level of interest in purchasing such a fresh label,” Mr Goyal said.
“We have quality stock on hand, marketing ready to roll out, and a significant social media following. This is a great opportunity for any interested buyer.”
Ideally, the administrators are looking to sell the entire brand so that the debt can be absorbed and all impacted creditors can get their money back.
The administrators are still inviting creditors to lodge their claims and suspect the total debt could climb higher.
Soda Shades has nearly 50,000 followers on Instagram and sent products around Australia as well as to the US and Canada.
An average pair of sunglasses cost $95.
Last year was the company’s best year in terms of sales, making $1.3 million for the 2021 financial year.
That means the company sold around 13,000 products, based on its average pricing.
However, supply chain issues exacerbated by months-long Covid lockdowns meant they were unable to move products and debts snowballed.
There will be a creditor’s meeting held in the first week of September.
Soda Shades joins a long list of Australian companies that haven’t been able to weather the economic crisis and have had no choice but to shut their doors for good.
Earlier this week, news.com.au reported that Victorian construction company Snowdon Developments had been court-ordered to go into liquidation.
Last week, luxury shoe retailer Sneakerboy went into voluntary administration after the company faced more than 10 wind up orders over the last three years from creditors.
A grocery start-up claiming it could deliver food within 10 minutes called Send also appointed administrators back in May, citing world factors like the Covid-19 pandemic as the reason for the company’s demise.
In the last financial year ending on June 30, Australia recorded a staggering 3917 liquidations or administration appointments across all industries, news.com.au previously reported.
alex.turner-cohen@news.com.au
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