Outdoor apparel retailer Snowgum Australia collapses after 89 years in business

Outdoor apparel retailer Snowgum Australia has collapsed into administration, with a sale for the 89-year-old Australian-owned business being sought.

Glenn Franklin, Petr Vrsecky and Jason Stone of Lawlor Draper Dillon in Melbourne have been appointed as administrators.

Franklin told SmartCompany this morning that the focus of the administration is to sell the business as a going concern, as this was the best chance of recovery.

He says the company, which has a franchise structure, has advertised for a buyer, with a number of parties already showing interest at the first expression of interest deadline.

“It is a well-known brand in a competitive market,” says Franklin.

The administrators reported that the amount of debt to unsecured creditors is estimated in the vicinity of $2.2-2.3 million, however, said this figure was subject to further verification.

Franklin says no major banks were owed money, but unsecured creditors consisted mostly of suppliers and landlords.

Franklin says the company has approximately over 86 employees plus casuals and operated 17 retail stores in Victoria, Tasmania, New South Wales, ACT and Queensland, together with eight franchisee stores in Victoria.

The administrators reported that a related retail business, MDS Pty Ltd trading as Midland Disposal Stores, operated five Snowgum Australia stores based in Western Australia.

The first creditors meeting for the Australian company will be held on November 4 at the Lawler Draper Dillon offices in Melbourne.

Snowgum Australia was launched at The Scout Shop in 1924, and has had various names and structures in its history.

It changed names to the Scout Outdoor Centre in 1978, then to Snowgum in 1992, with the view of reaching a broader market.

The Snowgum Australia website reports that the business was sold in 2004 to general manager Ross Elliott and a private consortium.

Its core product offer is performance outdoor clothing, designed for bush walking, mountain climbing and other adventurous activities. It also offers luggage, footwear and travel accessories.

Research into sustainable production has been key to the brand, with it using bamboo, organic cottons and recycled polyester in its range. The company launched an e-commerce division in 2012.

The news of the administration contrasts with the fortunes of Snowgum competitor Kathmandu, which recently recorded a 27% profit increase for financial year 2012-13.

2013 has been a challenging year for administrations in the apparel industry, including Bettina Liano, Kirrily Johnston and Lisa Ho.