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Espirit closes its doors in Australia and New Zealand

Espirit is closing its doors in Australia – over 60 outlets will be closed resulting in 350 people losing their jobs.

It is unclear yet, whether they will also close their eCommerce websites.

The company has been operating at a loss for some time and has struggled to find its place in the Australasian markets.

“In order to strengthen our foundation, the group intends to withdraw from these markets and this will allow us to concentrate efforts and resources to develop other markets in Asia,”

Thomas Tang, Espirit Executive Director

Espirit had sales of $50 Million across Australia and New Zealand, but only made up 2% of their global revenue.

Pippa Kulmar (strategist at consultancy Retail Oasis) said that Espirit had become trapped in the “middle” of the apparel market.

This is a dangerous position to be in, as it cannot compete with the low-priced basic apparel (such as H&M or Uniqlo), nor can it compete with higher-quality apparel brands.

“You’ve got premium growing on one side of that fashion market, and then you have fast fashion and more value-oriented retailers growing below it. Whoever is left in the middle is pulled apart.”

Pippa Kulmar, Retail Oasis strategist 

Espirit’s demise is not the first of its kind for retail apparel stores. American brand GAP closed its doors last year and Topshop has gone into administration.

Read the full article here.