What: A Kiwi store chain considers closing down in spite of faring better than expected after the Covid-19 Pandemic.

Why it is important: Investments needed in the flagship store to comply with security norms are too high for the company, which prefers shutting its doors instead.

New Zealand department store chain H&J Smith has announced plans to close its flagship store in Invercargill, along with stores in Gore and Queenstown, due to systemic changes in the retail sector that make it difficult for independent retailers to operate.

The company, which operates in a much smaller region than other independent department store brands (Ballantynes and Smith & Caughey), has already reduced its retail footprint since 2020.

Despite a better than expected recovery from the Covid-19 pandemic, the company faces challenges in procuring stock and establishing a sustainable growth model. The 12,000-sqm-wide flagship Invercargill store also requires significant investment for earthquake strengthening.

The company's proposal is open for consultation for four weeks, with a final decision due by June 23. Online trading is set to stop on July 1, and the last general trading day is scheduled for November 18.

New Zealand chain H&J Smith considers closing down activities