Kimberleys to close by Sunday as receivers fail to find buyer

Monday, 11 December 2017

Around 34 years of Kimberleys Fashion is likely to end on Sunday as receivers fail to find a buyer of the business.

All Kimberleys stores will close next week after receivers failed to find a buyer of the fashion chain.

Kimberleys Fashion went into receivership on October 2 after 34 years in business, due to financial pressure from changes in customer spending, overseas competition and online shopping.

Kimberleys Fashion went into receivership in October.

BDO Christchurch receivers Colin Gower and Andrew Grace said in the first receivers report that despite significant interest, they were unable to sell Kimberleys as a going concern.

The receivers valued the business's assets at $2.3 million including $346,000 in store fittings. The company owes creditors a total of $3.2m.

All preferential creditors including staff have been paid.

All preferential creditors including staff, who were owed $63,390, and Inland Revenue, owed $127,580, have been paid.

The receivers were unable to determine if unsecured creditors would be paid.

There are nine stores around the country, including an outlet store. Four stores are in Christchurch, two in Auckland, and one each in Wellington, Nelson and Dunedin.

Wellington's Kimberleys on Willis St has slashed prices recently and only a few racks of clothing remain.

Retail NZ general manager Greg Harford said fashion is particularly vulnerable to foreign online stores that had 'massive scale and a sizeable price advantage' because they didn't pay GST or duty.

'Over a long period of time the Government has failed to level the playing field by making foreign websites trading here pay their share of GST. This is making some retail businesses marginal, and ultimately costing jobs in New Zealand,' he said.

The Government's tax working group announced last month, it would have a 'wide mandate' to look at New Zealand's whole tax system, but has been directed to look at some specific areas, including GST.

The group will be allowed to consider the issue of GST on low value purchases, but will have no mandate to consider the GST rate. It could recommend that GST be added or removed from some products.