Ishka is the latest retailer to fall victim to Australia's retail apocalypse, filing for voluntary administration after a horror Christmas season.
The homewares chain, which sources products from developing communities, has launched a clearance sale, advising customers that "everything must go".
Previous strong trade
The family-owned Ishka business has 60 stores across the country with over 450 employees. Selling handmade jewellery, clothing, gifts, homewares and furniture, Ishka was founded more than 50 years ago in Melbourne.
After strong trading in the lead up to Christmas, including good results on Black Friday and Cyber Monday, the retailer was devastated when more than $3 million of Christmas stock was delayed until late January.
Christmas stock seized
The Christmas stock was seized by quarantine in late November as the person responsible for fumigating it overseas had lost their certificate. As a result, the stock had to be re-fumigated on arrival in Australia before being released. This meant Ishka missed out on crucial holiday trade.
Already fragile, the retailer was then hit with declines in trade due to the bushfires and extreme weather events, as well as coronavirus.
Ishka joins a parade of retailers forced to shutter shops this year and throughout 2019. Harris Scarfe, EB games, Bardot, Napoleon Perdis, and Karen Millen have all fallen prey to the brutal retail environment.
Survivors in focus
Despite torrid trading conditions in the Aussie retail sector, some ASX retail shares are bucking the trend.
Temple & Webster Group Ltd (ASX: TPW) saw revenue rise 50% in 1H20 to $74.1 million, a huge increase over 1H19 revenue of $49.4 million. Operating an online-only model, Temple & Webster is a market leader in the homewares and furniture sector that stands to benefit from a shift to online shopping as Millenials move into the prime furniture-buying age range.
Jewellery and accessories company Lovisa Holdings Ltd (ASX: LOV) is another retailer that continues to grow regardless of the tough trading environment. Lovisa opened a net 49 new stores during the first half of FY20, continuing its global expansion. The retailer recently reported a 10.7% increase in earnings before interest and tax (EBIT) which reached $40.41 million, while net profit after tax (NPAT) increased 9.1% to $27.85 million.
Australia's largest footwear retailer, Accent Group Ltd (ASX: AX1) has also demonstrated an ability to thrive despite the downturn, opening 51 new stores in the six months to 31 December. Accent Group's sales increased 10.9% to $507 million in the first half; while earnings before interest, tax, depreciation and amortisation (EBITDA) grew 10.5% to $67.7 million. NPAT increased 9.7% to $35.29 million in 1H20.
Foolish takeaway
While there is no doubt tough trading conditions have continued into 2020, not all retailers are feeling the pinch.
