The owner of John Cootes Furniture is shutting down the old-school retail chain
The owner of John Cootes Furniture is closing down the iconic furniture retail chain which was known for its TV ads in the 1980s and 1990s.
About 90 full-time staff and 45 part-time staff will lose their jobs.
“The significant increase in the competitive environment, combined with softer retail market conditions, has resulted in our decision to close the business,” owner Elanor Investors Group (ASX:ENN) told investors on monday morning.
Elanor (ASX:ENN) had been reviewing the business since June.
The decision follows the privatisation of another old-school TV-driven retail chain Godfreys — which exited the ASX last month after losing 90 per cent of its share price value in the past three years.
John Cootes had been in business for 30 years and was founded by a former priest-turned-rugby league player. It operated a dozen NSW and ACT stores in competition with the likes of Harvey Norman, Fantastic Furniture and Super A-Mart.
But like many other retailers it struggled to transition to the online world.
Here a John Cootes TV ad from the 1980s:
“The deteriorating trading performance of [John Cootes] over the past year, and particularly during the six months ended 30 June 2018, reflected a significant increase in the competitive environment for furniture retailing in New South Wales, and particularly the areas in which JCF trades,” Elanor said.
Weak consumer spending has seen some retailers fall on their swords in past years — but recent numbers from the Bureau of Statistics mark household goods as a sector with life in it.
By comparison, online furniture retailer Temple & Webster (ASX:TPW) has performed strongly over the past year, lifting revenue and its share price.
Elanor — a $186 million business that invests mainly in tourism, leisure and commercial property assets — had tried to offload John Cootes but could not find a buyer.
“Elanor has now decided to commence an orderly closure of the business,” investors were told today.
Elanor made a loss of $3.2 million in the December half on lower revenue of $49.6 million.
It is expected that all JCF stores will be closed by the end of the calendar year.
The closure was not expected to impact the 2019 financial year.