Retail industry era ends
Stuttafords to shut up shop soon after falling victim to economic downturn
DEPARTMENT store Stuttafords, the 159-year-old “Harrods of South Africa”, is closing down. It has become a victim of a global shift to online retail and a domestic economic slump that has put brands like Ted Baker and Gap beyond its customers’ reach.
Mirroring the fortunes of oncemighty department stores in Europe and the US, the doyenne of the South African high street during apartheid and the two decades since applied for protection from creditors in October.
However, attempts to revive its fortunes proved futile and creditors voted in June to wind up the unlisted firm by August 1, with closing-down sales at its nine stores in South Africa, two in Botswana and one in Namibia.
In its flagship store in Johannesburg’s Sandton financial district, piles of naked mannequins lay in heaps next to bare shelves as the last few bargain hunters picked through trays of heavily discounted perfumes, makeup and clothes.
“We don’t know what’s going to happen – if we will still have jobs,” one employee, who did not want to be named, said. “We only heard that maybe this shop will be one that will not close.”
For South Africa, it is the end of a piece of retail history.
The first shop was opened in Cape Town in 1858 by Samson Rickard Stuttaford with the vision of creating a Harrods-like department store in what was then Britain’s Cape Colony.
Its main Cape Town store, opened in 1938, was designed by in-house Harrods architect Louis David Blanc and echoed the British store’s famous frontage in London’s exclusive Knightsbridge.
Through various changes of ownership, it never lost its focus on the middle- and upper-class South African market, despite the economy’s failure to recover fully from a recession in 2009 sparked by the global financial crisis.
Chief executive Robert Amoils could not be reached for comment, but has defended his approach to the tough conditions.
“I believe the path we set was correct,” he told business website Fin24. “We ran out of time.
“The market downturn was so swift, so severe.”
John Evans, a lawyer overseeing its closure, said he had received a last-minute approach that could salvage outlets in Sandton and Eastgate which would save the jobs of 300 of the group’s 950 staff.
Nearly all retailers in South Africa have struggled as consumer sentiment has hit multi-year lows, a result of high unemployment and inflation.
Macy’s and Nordstrom in the US had also hit tough times, suggesting Stuttafords’ woes were not unique to South Africa, Sasha Naryshkine, of asset manager, Vestact said. The main squeeze has come from cheaper retailers.
“The fall from grace in all these department stores is that people can get the same stuff online and there is a rise of other quality brands at a cheaper price.” Nor is Stuttafords alone. Edcon’s Edgars was taken over by creditors last year and had to restructure debt.
In May, no-frills retailer Mr Price posted its first annual drop in profits in 16 years, while rivals Woolworths and Truworths flagged lower earnings last week. – Reuters