David Jones suppliers unpaid debts administration, Digi Mart USA News (Australia): David Jones’s embattled suppliers have been asked to continue providing goods and services to the collapsed retailer, despite having no guarantee they will be reimbursed for previously unpaid debts. Documents seen by ABC News show the unclear situation facing suppliers after the 188-year-old retailer was plunged into receivership and voluntary administration this week.
“It is really stressful,” Jacob Leung told ABC News. He and his wife, Sarah Jane, started supplying David Jones with handwoven blankets from their small business, Slowdown Studio, only 18 months ago.
“We’d never received an order that size. We loved the brand, the heritage, the whole David Jones experience.
We were so pumped,” he said.
Slowdown Studio is owed $75,000. The local business sent another order to David Jones last month, but says it has not received the money and its invoice is now overdue.
The David Jones collapse is a complicated affair, with receivers appointed on behalf of the company’s biggest lender, Hilco, to protect an investment estimated in the hundreds of millions. Documents sent out by the receivers’ firm, FTI Consulting, outline the next steps for suppliers.
The documents note that David Jones is “continuing to trade in the ordinary course under the control of the receivers” while its administrators pursue “the recapitalisation and/or sale” of the business.
According to the documents, any “outstanding debts owed by David Jones” when the administration started on November 5 are now “subject to the outcome of the administration process.” FTI notes that suppliers can keep their relationship with David Jones if they create fresh supplier accounts with the receiver.
David Jones’s receivers are telling brands they can keep supplying the retailer, while luxury brands are visibly removing stock from its stores. Gucci, Valentino and Saint Laurent are among high-end brands that have left shelves bare as concern grows about the retailer’s future.
Mr Leung is not sure what he will do next or whether his business will keep supplying stock to David Jones. Beysis, another start-up Australian label, faces a similar predicament.
The company says it is owed an invoice in the six figures for a delivery earlier this year. Co-founder Jessica Bryce said they likely could not justify the risk of continuing to sell to David Jones during the administration process.
“I don’t think that we would. Not at this stage.
We’re owed money and the stock,” she said. “As a small business we just wouldn’t take that risk.
It hurts. It affects everything that we do.
It has been a tough year.”
Ms Bryce said they had heard reports in the industry that big brands were being put on payment plans by David Jones, while Beysis was being paid erratically. “It affects how many casuals we can put on, how much marketing we can spend, inventory.
It affects everything, you name it.”
David Jones was bought by private equity firm Anchorage three years ago for $100 million. Documents from ASIC show that under Anchorage the business recorded losses of $74 million in the 2023–24 financial year, followed by $62 million in losses in 2024–25.
“[Anchorage] had a very clear plan on how to turn David Jones around and make it profitable, and clearly that doesn’t seem to have panned out,” Monash University law and insolvency expert Tamara Wilkinson said.
The company did not lodge its latest financial statements with ASIC on time last week, one of the clear signs that the retailer was in serious trouble. Finer detail on how much is owed has not been made public, and a first creditors meeting is not scheduled until next week.
Some suppliers have told ABC News they are in the dark about next steps.
Dr Wilkinson warned that even a sale of the David Jones business might not recover what is owed to creditors, including its 6,000 employees and suppliers. She explained that in an insolvency, secured creditors, in this case Hilco, stand first in line to be repaid from any recovered money.
They are followed by employees, who receive wages and superannuation owed, and then suppliers and gift card holders. Small businesses such as Slowdown Studio and Beysis are therefore at “the very bottom” of the pecking order, she said.
“The only people worse off than them are the shareholders of the company,” she added.
Dr Wilkinson said she remains hopeful about the iconic retailer’s future. “I think someone will buy it,” she said.
FTI Consulting told ABC it would provide no further comment. Meanwhile, the administrators at McGrath Nicol said suppliers and other creditors owed money would receive more information soon.
“The administrators will issue their initial circular to all creditors on Tuesday 10 November,” McGrath Nicol said in a statement to ABC News. “This will include details for creditors on attending the first meeting of creditors at 11am on Tuesday 17 November and further information regarding the voluntary administration process.”
Mr Leung has never been through a company administration before and does not know what to expect as an unsecured creditor of David Jones. “It seems like we’ll be lucky if we get a couple of cents to the dollar from them eventually.
But that ‘eventually’ could be months or a year away, who knows,” he said.
