01 Closing of store and clearing out of stock

The market is constantly changing, with some people entering and others exiting.

Recently, Australian clothing retailer Jeanswest declared bankruptcy and the company will close more than 90 stores in the coming months, which is equivalent to directly shutting down Jeanswest's offline retail channels in Australia.

Internal personnel attributed this result to rising living costs and reduced consumer spending, which made it difficult for the brand's physical stores to continue. In a statement, Jeanswest said: "The company has tried its best to maintain operations, but after five years of hard struggle, we have to give up this decision."

Currently, Jeanswest is conducting a mid-season promotion and it is expected that inventory in all closed stores will soon be cleared out and sold off, while online channels will also be sold simultaneously to reduce the company's debt burden as much as possible.

Previously, in early 2020, Jeanswest had encountered a store closure crisis and had entered bankruptcy proceedings, but soon Jeanswest found a new buyer and began to reduce its business scale and escape the brink of bankruptcy. This time, Jeanswest has declared bankruptcy again, and it is probably impossible to turn the tide.

In fact, what happened to Jeanswest is not an isolated case. The reason it cited for store closures, “rising cost of living,” has also put other retailers under great pressure.

Before Jeanswest, Australian fashion giant Mosaic Brands declared bankruptcy, hundreds of stores were forced to close, and the company owed nearly $250 million in debt. Luxury retailer Harrolds went bankrupt after nearly 40 years of operation, with debts of $16 million. Online fashion retail platform Ally Fashion announced its closure, and the company was forced to liquidate due to unpaid rent...

It is sad to see brands fall one after another. This also reminds all sellers that market trends are ever-changing and their impact is difficult to estimate. The best way to deal with it is to be aware of it at all times and face challenges head-on.

02 The rise of new forces

In fact, the reason for Jeanswest's bankruptcy is not just the rising cost of living. After all, the overall market trend is always growing, and some people are out of the game, which only means that the latecomers are ahead.

For example, in the past, in the field of e-commerce, eBay, Etsy, Redbubble and Catch.com.au were the four leaders in the Australian market, but now, these platforms have more or less lost some market share, and even Catch Australia has decided to close at the end of April this year.

The lost market share naturally fell into the hands of latecomers, such as Temu, Shein, and Amazon. According to the latest e-commerce report released by Australia Post, Australia's online shopping spending will reach US$69 billion in 2024, a year-on-year increase of 12%. Among them, Amazon, Shein and Temu played a key role in promoting this.

According to data from research firm Roy Morgan, about 4 million Australian online shoppers have purchased something from Temu at least once, and about 2 million have used Shein at least once. Temu alone is expected to have annual sales of more than $2 billion.

A report by e-commerce intelligence company Pattern pointed out that in 2023, Amazon surpassed eBay for the first time and became Australia's most popular e-commerce platform.

Obviously, in the turbulent market, new forces have risen strongly and gradually occupied the high ground. Platforms that fail in the competition will naturally lose their position or even be eliminated. This is an eternal law in any market. The result of this competition may be a leap or a sharp drop for a platform, but it will be a continuous source of power for the development of the entire market.