G-Star’s ‘sudden’ slip

gstarInside Retail PREMIUM speaks exclusively to G-Star following the collapse of the brand’s local franchise operator, Denim Enterprises.

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Denim Enterprises, the franchise operator of Dutch denim label G-Star Raw, in Australia, has been placed in voluntary administration, with the local head office still reeling from the news, describing its collapse exclusively to Inside Retail PREMIUM as “sudden”.

Denim Enterprises appointed Gess Michael Rambaldi and Andrew Reginald Yeo of Pitcher Partners as voluntary administrators on February 2.

Denim Enterprises is based in Melbourne and operates all 21 G-Star retail outlets in Australia.

Denim Enterprises was founded by directors, Nick and Candice Hirons in 1996, who were previously stockists of the brand in their own Melbourne denim boutique, D.inc.

The first D.inc stored opened on Little Collins St in 1996, followed by a second store in Prahran in 2001.

The first standalone G-Star store operated by Denim Enterprises opened in 2003 at Melbourne Central.

G-Star’s latest store was unveiled at Emporium in Melbourne just over six months ago under the Amsterdam-based label’s new global fitout. It also has 25 concessions stores in Myer and David Jones and operates a multi-brand store model with retailers such as Glue.

G-Star’s wholesale division including department store concessions and multi- brand stores are owned by G-Star’s Australian parent company, G-Star PTY LTD.

This model is in line with its global operations where retail outlets are franchised by the parent company, while wholesale remains company-owned and operated.

G-Star PTY LTD is based in Sydney, headed by country manager, Piet Poelmann.

Online is also a separate entity to Denim Enterprises. While Australian customers can shop online, orders are processed and shipped through the company’s global head office.

Poelmann told Inside Retail PREMIUM that Denim Enterprise’s administration was “quite sudden”.

“We have contacted the administrators and our head office in Amsterdam. We want to take the next week or so to really nut things out as to what we’re going to do next,” Poelmann said.

Gstar, denim, fashion

Administrators, Pitcher Partners, told Inside Retail PREMIUM stores would continue to trade as usual during the administration process.

“The administrators will be continuing to trade the business as usual and will work towards the implementation of a restructure that continues to promote the brand and its retail footprint in Australia,” Pitcher Partners said.

It is not yet known if stores will be closed, or if the global arm of G-Star Raw will buy out the licence of the stores from Denim Enterprises. So far, stores continue to operate.

In 2011, the luxury streetwear label repositioned itself in the marketplace with lower pricepoints aimed at making the brand more accessible to a mass audience, however, at the same time was cautious to maintain its international luxury reputation.

G-Star’s pricepoints put it in line with denim brands such as Lee, Wrangler, Calvin Klein, and Levi’s. Women’s and men’s jeans range from $170 to $220, while basic t-shirts, shirts, and knitwear range between $40

and $230. G-Star also stocks men’s and women’s shoes, underwear, accessories, and collectibles.

In January, Poelmann told Inside Retail PREMIUM a refurbishment of existing stores was planned for 2015 following the opening of Emporium.

The new concept at Emporium sees G-Star go back to its roots as a denim and streetwear brand, with the fitout having a clear focus on its denim ranges.

A main design element of the new store is the introduction of the ‘seven icons’, an island
in the centre of the store which showcases G-Star’s seven iconic denim styles’.

Other store features include digital screens that stream live content, instore iPads, a custom made instore fragrance, and larger fitting rooms located in the centre of the store which include bathrobes and slippers for customer use.

Last month Poelmann said several new sites are earmarked for this year.

G-Star is also planning to open smaller size stores following on from its new format. The proposed smaller format will see stores operate with a footprint around half the

size of existing outlets, around 100sqm to 150sqm.

This new size will allow G-Star to trial new locations and concepts such as men’s and women’s standalone stores − a model yet to be launched by the retailer in Australia.

This story first appeared in Inside Retail PREMIUM issue 2032. To subscribe, click here.

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