The Princess of Wales wore the British fashion brand. Photo / Peter Byrne/PA via AP
The Princess of Wales wore the British fashion brand. Photo / Peter Byrne/PA via AP
An Australian franchise business distributing a British fashion retailer's goods has failed.
The business made its New Zealand retailing debut only two years ago.
But now, Luxury Retail No.1 is in liquidation.
The Mulberry high-end handbag and clothing brand, sometimes worn by the Princess of Wales Kate Middleton as wellas American Meghan Markle, opened its first New Zealand store in Westfield Newmarket before Christmas 2020.
But yesterday, the first liquidator's report was issued on the company which operated the Australasian franchise to sell Mulberry goods.
The Herald reported in 2020 how the business was opening its first store here with the potential to expand elsewhere in this country.
Conor McElhinney and Kare Johnstone of McGrathNicoll in Auckland are liquidating the New Zealand arm of the business.
The Australasian group incurred trading losses for some time and directors Nelson Mair and Theo Poulakis attributed that partly to pandemic lockdowns and border closures that hit the luxury retail market.
The company and its parent operated the Australasian franchise of Mulberry but are not part of the Mulberry group of companies, the liquidators emphasised.
Total current assets are listed at $222,645 but with store fittings and IT equipment, are worth $1.03m
Total current liabilities are listed as being $1.8m. Those include a lease incentive liability of $734,000 as well as a loan from the company of $170,536.
All that results in a negative net asset balance of $820,000.
Local franchise of luxury brand worn by royalty has failed. Photo / supplied
But liquidators said they planned to continue trading the company on a business-as-usual basis to preserve goodwill while a sale is undertaken.
Liabilities include a Covid-19 business support loan Inland Revenue offered.
The liquidators also cited a portion of the cost of the Newmarket store's fit-out paid by the landlord as a rental incentive. That was also listed as a liability.
Work and Income showed Luxury Retail No.1 got a wage subsidy in August last year for eight paid employees. That subsidy was $38,616, records showed.
The liquidators' first report said creditors of Luxury Retail No.1 include Mulberry Company (Design) of Bath, Somerset in England. But it did not say how much that business was owed. Four employees' names appear on the liquidators' schedule.
Paul Gardner, Scentre's regional manager for NZ outside the store. Photo / supplied
Scentre Shopping Centre Management (NZ) was also listed as a creditor. That is based at 277 Broadway in Newmarket.
Spark NZ and Inland Revenue also appear on the creditor's list along with Vermeulen Officer Media.
Two years ago, the Herald reported Westfield Newmarket owner Scentre Group saying the opening of Mulberry would be a key milestone for the shopping centre, marking the first retail opening in the luxury retailing precinct.
The Princess of Wales wore the British fashion brand. Photo / Peter Byrne/PA via AP
John Papagiannis, director of leasing, retail solutions and NZ development at Scentre Group, said Mulberry's arrival represented "the first of many luxury openings" to come at Westfield Newmarket.
"Renowned for its quintessentially British designs, Mulberry is a brand we know our customers will really value and enjoy and we look forward to celebrating its grand opening next month," Papagiannis said two years ago.
The liquidators said McGrathNicol New Zealand was approached by McGrathNicol Australia, who were requested by the lawyers for the secured lender of the company's parent to accept appointment.
Australian media reported last month that the Australian operations of Mulberry in that country were for sale after the fashion giant moved to take back control of its local franchise.
Mulberry, listed on the London Stock Exchange, has five stores in Australia: three in Melbourne and two in Sydney. The stores are continuing to operate as usual with all staff to remain employed across the Tasman.
