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      Business trends

      Australia's fashion industry shrinks as global brands move in

      Domestic clothing makers squeezed as e-commerce and a slow economy reshape market

      A model shows off a Roger David shirt and jacket during the 2016 Melbourne Fashion Festival. The iconic Australian company closed the last of its stores in December 2018.   ? Getty Images

      SYDNEY -- Australian fashion brands are starting to fold amid fierce competition from global retailers and e-commerce sites, as well as from consumers feeling the squeeze of the country's slowing economy.

      Menswear retailer Roger David -- an iconic brand for 76 years -- shuttered the last of its 57 stores in December last year. "Everyone recognized the strength and the affection for the brand, but it did not pass the viability test," said Craig Shepard, a partner at KordaMentha, which oversaw the closings.

      Roger David, which had more than 100 stores at its peak, blamed "the influx of multinational retailers and the rapid, global evolution of online shopping" for its demise. It had announced in October last year that it would enter into voluntary receivership to try and find an investor but to no avail.

      "[Australia's] retail clothing environment was too tough to make it work," Shepard told local media.

      In fact, global apparel brands have been making huge inroads into Australia. Inditex, the Spanish owner of Zara, tapped the market in 2011 while Sweden's H&M Hennes & Mauritz entered in 2014. Uniqlo, the casual clothing brand of Japan's Fast Retailing, is also gaining market share.

      Roger David is not the only high-profile domestic brand that is suffering. Womenswear retailer David Lawrence and accessories brand Oroton Group had to find ways to survive in the face of fierce competition from cheaper, more functional and fashionable global brands.

      David Lawrence was eventually acquired by department store operator Myer, while fund manager and major shareholder Will Vicars increased his stake in Oroton.

      Research company IBISWorld estimates that Australia's clothing market will increase 0.3% on the year to 16.8 billion Australia dollars ($11.7 billion) in fiscal 2018 through June. That is much lower than the country's real gross domestic product growth of around 2-3%. IBISWorld cited less disposable income for the tepid market expansion.

      The increasing number of e-tailers is also weighing on brands that rely heavily on brick-and-mortar sales, pressured further by the opening of Amazon's local operations.

      Australia's e-commerce market totaled AU$21.3 billion in 2017, up 18.7% from a year earlier and surpassing overall retailers' 2.5% on-year growth, according to data from state-run Australia Post.

      Australians are frequent visitors to American and British e-commerce sites. More than 80% of Australian consumers use overseas e-commerce sites, according to the Japan External Trade Organization.

      Buying clothing online is particularly popular owing to the wide variety, even after considering shipping costs, said one Aussie woman in her 30s.

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