Clothing brands in liquidation as retail turmoil spreads

The terrible year for Australia’s fashion industry has continued, with well-known Melbourne clothing brand Bauhaus, AAH!!, Shark, One Tru Luv and Cloak & Dagger in the hands of receivers.

The companies which owned the brands, Covert Direct and Rook, were placed in the hands of liquidators Keith Crawford and Matthew Caddy of insolvency firm McGrathNicol on August 17 after creditors moved to have the company wound up.

Streetwear brand Bauhaus is the best known of the companies’ brands.

Launched in 2005, the brand was pitched as affordable men’s clothing, with a focus on the youth market – radio hosts Hamish Blake and Andy Lee were two celebrities to don the company’s t-shirts.

The brand was stocked by Myer and more than 100 independent clothing stores in Australia and New Zealand.

Crawford told SmartCompany this morning that the business has effectively ceased trading for the current time.

“There’s a residue to stock that we are hoping to deliver to customers to meet pre-existing orders but as this stage I am not taking production orders.”

He says it is still too early to say who may emerge as a buyer of the businesses.

“Obviously the Bauhaus brand is currently used by Myer so it may be that there is interest there but as this stage I really don’t know.”

The brands are the latest in a long line of fashion-related businesses to have collapsed since the start of the year, including retail chains Brown Sugar and Colorado Group, women’s fashion label Bettina Liano, Sydney-based retailer Fashion Factory Clearance and women’s clothing manufacturer, designer and retailer Covers Design.

The latest retail trade data from the Australian Bureau of Statistics highlighted the plight of the clothing and footwear industry – sales in the sector were down 0.1% in July.

In the last 12 months, sales have fallen 4.9%.

Crawford says that while he is yet to start investigating the specific circumstances around the collapse of Covert Direct and Rook, he is “sure the trading conditions haven’t helped”.

“They’re in the supply chain and you can’t insulate yourself from the environment.”