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Australia's oldest department store chain David Jones faces financial trouble after 188 years, 6,000 jobs at risk
Known for luxury shopping, festive window displays and a 188-year history, David Jones has entered voluntary administration.
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For nearly two centuries, David Jones was a familiar name in Australia's shopping landscape, known for its luxury labels, elaborate Christmas displays and premium department stores. But the 188-year-old retailer is now facing a major setback after entering voluntary administration, putting around 6,000 jobs at risk.
The Australian department store chain's 38 outlets across Australia and New Zealand, along with its online business, will continue trading for now. Administrators are examining its finances and exploring options to restructure or sell the business
Why has David Jones entered administration?
According to a Reuters report, David Jones has struggled with rising operating costs, supply chain pressures and competition from online shopping platforms and fast-fashion brands. Founded in Sydney in 1838, the retailer operates 38 stores across Australia and New Zealand.
The move followed unsuccessful negotiations with Scentre Group, the owner of Westfield shopping centres. Seventeen of David Jones' stores are located in Westfield centres. Scentre said the retailer had not paid its October rent and was in breach of its tenancy agreement.
McGrathNicol has been appointed voluntary administrator, while FTI Consulting is overseeing the business as receiver. The administrators will explore options to restructure or sell the retailer.
Chief executive Erica Berchtold said David Jones had a "well-developed plan" to reset the business for the future. Christopher Hill of FTI Consulting cited the challenging retail environment, rising costs, an outdated store network and supply chain pressures. He said the administration process would provide some "breathing space" as the business considers its options.
From luxury shopping to changing consumer habits
For generations of Australians, David Jones was associated with premium brands, its distinctive black-and-white houndstooth pattern and elaborate Christmas window displays.
Its flagship stores in Sydney and Melbourne were more than shopping destinations for many families. Visiting them during the festive season, particularly to see the decorated windows, became a tradition. The retailer also describes its Christmas choir, which began performing at its Elizabeth Street store in 1951, as an experience passed down through generations.
Dr Jana Bowden, a marketing academic at Macquarie University's Business School, told the BBC that David Jones was once regarded as the Australian equivalent of Harrods. She described it as a destination associated with glamour, luxury labels and a special shopping experience.
However, the traditional department store model has struggled to adapt to changing customer expectations. Bowden said the suburban outlets had lost some of the appeal associated with the brand's flagship stores.
David Jones' place in Australian history
The retailer's history includes a royal connection. During Queen Elizabeth II's first visit to Australia in 1954, a state banquet was held in her honour at the Great Restaurant on the seventh floor of David Jones' Elizabeth Street store in Sydney. The Powerhouse Collection records the place setting used by the Queen at the dinner.
The administration process will now determine whether David Jones can continue in a restructured form or be sold.
