Major Aussie Fashion Brand Falls: Ally Fashion Goes Under.
Australia’s retail industry is facing yet another major setback, with fashion retailer Ally Fashion collapsing, putting up to 185 stores across the country at risk.
The fashion chain, which employs over 1,000 staff members, was ordered to be wound up by the Federal Court of Australia on Friday due to insolvency, marking another significant loss for the retail sector.
Established in 2001, Ally Fashion has been known for offering trendy and affordable women’s clothing. The brand positioned itself as a go-to destination for stylish, ready-to-wear pieces, boasting over 50 new styles each week. Over the years, it expanded its offerings to include a curvy brand called You & All, a maternity and childrenswear line under Mummy and Me, and even briefly ventured into menswear three years ago.
With locations spread across New South Wales, Victoria, Queensland, South Australia, and the Northern Territory, the retailer had a strong national presence. However, just days before its collapse, the company was actively recruiting for store managers and sales assistants, unaware of the impending financial crisis.
Court documents indicate that the winding-up process was initiated by a commercial property group specializing in retail shopping centers, with several other creditors supporting the move. News.com.au has reached out to BDO Sydney for further comment on the matter.
The collapse of Ally Fashion comes at a time when the Australian fashion industry is under immense pressure, with several high-profile retailers struggling to stay afloat due to rising costs and declining consumer spending. The ongoing cost-of-living crisis has significantly impacted discretionary spending, particularly in sectors like fashion, footwear, and accessories.
Mosaic Brands, once home to well-known labels such as Autograph, Noni B, Katies, Millers, and Rivers, also fell into liquidation recently. Despite efforts to find a buyer, hundreds of stores ultimately shut down, leading to widespread job losses.
Last year, luxury Australian fashion brand Harrolds also went into liquidation after nearly four decades in business. The company cited reduced luxury spending, lower foot traffic, high office vacancy rates, and challenging government policies as key factors in its downfall. Similarly, the prestige fashion brand Dion Lee struggled despite dressing global icons like Taylor Swift and Dua Lipa, ultimately failing despite its impressive global reach of 160 outlets and six standalone stores in Australia.
Retail expert Professor Gary Mortimer from Queensland University of Technology Business School weighed in on the situation, noting the sharp decline in consumer spending.
“The categories of fashion, footwear, and accessories rely heavily on discretionary spending, which has been significantly impacted by economic challenges. Over the past six months, we have seen Mosaic Brands wind up multiple labels,” he explained.
A major concern arising from these retail failures is the increasing job losses. According to Professor Mortimer, thousands of Australians are now facing unemployment at a time when the cost-of-living crisis is already taking a toll.
“For Mosaic Brands alone, Rivers lost 650 jobs, and Katies saw 500 layoffs. When you look at the overall picture, we’re talking about thousands of workers affected. This, in turn, reduces household spending, creating a cycle of economic strain,” he added.
Mosaic Brands previously operated 666 stores across Australia and New Zealand under labels including Millers, Noni B, Rivers, Katies, Autograph, Crossroads, W.Lane, and Beme.
Reports indicate that over 2,800 employees were collectively owed $22 million in wages and entitlements. The company’s total outstanding debt has been estimated to exceed $318 million, adding to the growing financial distress within the retail industry.
As economic challenges persist, the Australian retail sector continues to navigate an uncertain future, with more businesses potentially facing similar fates if consumer spending does not recover soon.
