Topshop NZ strong despite Australia collapse

Strong competition is affecting the New Zealand retail sector. Photo / File

Fast fashion is going through hard times in New Zealand as competition builds, a retail expert says.

Retail New Zealand general manager of public affairs, Greg Harford, told Newstalk ZB's Early Edition the retail sector is "gloomy".

Topshop has been placed into voluntary administration in Australia after trying to restructure its business.

"There's been some speculation [problems arose in Australia] around the logistics model sourcing products out of the UK rather than directly from the source," Harford said.

Topshop in New Zealand wasn't facing similar problems, he said.

The Australian Topshop business had nine standalone stores, 17 Myer concessions and an online business. In New Zealand, Topshop has had a much slower roll out.

"Topshop operates essentially as a licensed franchise model and operates quite differently in New Zealand and by different people.

'The chain here in New Zealand is operated by some very well respected businesspeople and great retailers. I think they have it under control.

"It's pretty hard out there for retailers particularly in the fast fashion industry. There's strong domestic competition and intense competition from offshore from online retailers websites."

Recent arrivals, global brands Zara, H&M and Topshop have all ramped up competition.

"They have all arrived recently, driven by customer demand, but also by the relatively strong New Zealand economy because while New Zealand retailers might be feeling gloomy the reality is New Zealand is doing relatively well compared to other parts of the world."