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kikki.K closure of luxury stationery chain in Australia after a 'perfect storm' in retail

[Economic News]     11 Mar 2020
The luxury stationery company kikki.K has been placed under voluntary trusteeship, and the chief executive PaulLacy described the retailer as being hit hard by a "perfect storm" of economic shocks. The $70 million company last year will be restructured, leaving more than 450 full-time employees waiting for the bankruptcy process to begin.

The luxury stationery company kikki.K has been placed under voluntary trusteeship, and the chief executive Paul Lacy described the retailer as being hit hard by a "perfect storm" of economic shocks.

The company, which last year earned $70 million, will be restructured, leaving more than 450 full-time employees process to begin.

Cor Cordis has been appointed as the receiver and manager of the Swedish design and stationery business established in 2001.

Prior to the collapse of the kikki.K, a number of local retailers had collapsed, including the Harris Scarfe closure of department stores before Christmas, the subsequent closure of Genius (Jeanswest), the Curious Planet retail chain of Colette Hayman`s fashion company Colette,Laura Ashley and Co-op Bookshop, and the recent Ishka. of household goods chains

Barry Wight and Bruno Secatore were appointed to manage the failing retailer, possibly involving restructuring or selling its business.

"Due to weak consumer spending, high rental costs and a disappointing December/January business season, kikki.K unfortunately joined many retailers in financial distress. "

"As a matter of urgency, we are working with management to develop a business restructuring and value-enhancing plan, as well as survey of kikki.K sales. "

voluntary trustee JP Downey&Co has been asked to supervise the process.

Previously, Australia`s retail spending was flat in January and December, with retail transactions falling by 0.3 per cent seasonally.

Staff at several kikki.K stores, after receiving journalist calls, said they were aware of the trusteeship but were not allowed to comment on it. "We have no more news than you ," said one.

The kikki.K co-founder Krstina Karlson stated that the company had made every effort to the business, but acknowledged the need for "radical restructuring ".

"There are still 3.7 million loyal customers in our database and more than 20 million visits to our physical and online stores every year, which is a very good business opportunity and a great opportunity to develop new products ," she said.

"We know that we have done our best to avoid such an outcome ," she said.

Mr Lacy blamed a series of international crises, which cut sales, skyrocketed costs, and disappointed christmas sales, businesses in trouble.

"As with all retailers, we are responding to profound structural changes as people change shopping habits and start buying more online and fewer goods in physical stores ," he said.

"We have suffered a triple blow: weak consumer demand, the impact of mountain fires on businesses, and the recent unprecedented and far-reaching impact of the new crown virus are hitting many businesses and countries so hard. "

For the past 12 weeks Mr. Lacy has served as chief executive, saying he has been trying to save the company`s business.

"I have identified many opportunities for improvement and have been working with our team to restore the outstanding operations we have always known, but these initiatives are currently on hold as we shift our focus to finding new homes for this brand and we want new partners. "he said.

The company recently lost its chief executive Iain Nairn, who turned to be president of one of Canada`s most famous department stores Hudson Bay.

kikki.K opened in melbourne in 2001, with more than 100 outlets around the world at its peak, then contracted to 65, with outlets in the uk, new zealand, singapore and hong kong.

(All rights reserved in this article are reserved for the Australian newspaper)

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