Deloitte Takes Control of 112-Year-Old Footwear Business
Wittner, the iconic Australian footwear brand, has entered voluntary administration after 112 years of operation. Deloitte restructuring experts Sal Algeri and David Orr were appointed joint administrators of Wittner Group Holdings, Retail Australia, and Retail New Zealand on Wednesday.
The Australian Securities and Investment Commission confirmed the appointments in official filings. The administrators have begun an urgent review of the company’s finances and are seeking expressions of interest for a potential sale or recapitalisation.
Figure 1: Wittner gone into administration after 112 years of operation
Trade Continues During Financial Assessment
Deloitte stated the business would continue to trade normally while the financial review progresses. Algeri said, “We understand the appointment of administrators will be particularly concerning to employees, as well the very loyal customer base it has built over decades.”
He added, “Please be assured that trade will continue on a business-as-usual basis as we conduct an urgent review of the group’s finances and seek expressions of interest from parties interested in the sale or recapitalisation of this iconic Australian brand.”
Physical Footprint Spans Australia and New Zealand
The company operates more than 20 standalone stores across Australia and New Zealand. The business also runs over 25 concession outlets in David Jones and Myer department stores. In addition to physical stores, the company maintains an e-commerce platform. Customers can access the platform through Wittner’s own website, as well as Myer, David Jones, and The Iconic.
E-Commerce Growth Fails to Offset Rising Costs
Management stated online sales and concessions in Myer had grown in the past year. However, these gains could not offset operating costs. In a public statement, Wittner’s management said, “The growth in sales has been eroded by cost pressures from rising wages and occupancy costs, and more recently challenging trading conditions and supply chain disruptions.”
They added, “We have invested in our range and teams over the last twelve months and remain committed to the Wittner business. We will work closely with the Administrators to achieve the best outcome for the business and its stakeholders.”
Figure 2: Wittner failed in capitalising e commerce market
Retail Sector Pressures Weigh Heavily
Retail analyst and professor Gary Mortimer from the Queensland University of Technology attributed Wittner’s struggles to broader economic factors. Mortimer noted that rising living costs and 13 consecutive interest rate hikes had squeezed discretionary spending. “When you have increasing costs of living, what takes place is discretionary spending is eroded,” Mortimer said.
He added that families prioritise essential spending over non-essential items like clothing and shoes. “Families then start to focus more heavily on servicing debt, paying back mortgages, paying rent, putting food on the table, putting fuel on the car, rather than going out and buying a new coat, or a new pair of jeans, or a new pair of boots for winter.”
Currency Pressures Impact Import Costs
Mortimer also said that a relatively weak Australian dollar had affected profit margins. Many local retailers, including Wittner, source their products from overseas suppliers. As the dollar weakens, import costs rise, further reducing profit margins despite steady top-line sales.
Potential Acquisition Could Save the Brand
Mortimer suggested the business might attract acquisition interest. He cited Myer’s recent purchase of Just Group, which operates Just Jeans, Dotti, and Jay Jays. Mortimer said Wittner could become viable again if it shut down standalone stores and focused on e-commerce and concession outlets.
Historical Significance of Wittner
Founded by HJ Wittner in 1912, the company began in Melbourne’s western suburb of Footscray. Wittner introduced Australia’s first mail-order shoe shop. According to the company, early demand was so high that the local post office expanded its operations to meet delivery needs.
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The brand secured high-profile locations over the decades. It opened a flagship store on Collins Street in the 1940s, operating in the renowned Block Arcade shopping precinct. The business prioritised women’s shoes, offering professional and fashionable footwear. Wittner expanded through Westfield shopping centres during the 1990s and 2000s.
By 2008, the company employed around 400 staff across 40 retail locations. Although it left the Block Arcade in 2023, Wittner continues to operate a store on the ‘Paris end’ of Collins Street.
Industry-Wide Impact Evident in Recent Collapses
Wittner’s administration comes during a wave of retail collapses across Australia. Denim retailer Jeanswest went into administration last month, closing more than 90 stores. Earlier in the year, Mosaic Brands shut down operations of Rivers, Millers, Noni B, Rockmans, and Katies. That closure resulted in more than 900 job losses.
Outlook Remains Uncertain for Retail Legacy
Hilco Capital, a British private equity firm which also acquired Cue Clothing, recently purchased Wittner. The profitability of Wittner in previous years had made it an attractive acquisition target. However, current conditions have brought the business to the brink.
Wittner continues to operate as usual while Deloitte seeks a buyer or investor. The company remains committed to staff, customers, and ongoing trade while navigating its financial restructuring. The outcome will depend on expressions of interest received during the administration process.
