Australia's tough retail market may be about to claim the discount store business owned by Kathmandu founder Jan Cameron, with questions growing about the number of stores closing around the country amid reports of mounting losses and unpaid bills.
Ms Cameron acquired Retail Adventures — the operating company behind Go-Lo, Sam's Warehouse, Crazy Clark's and Chickenfeed — for $70 million in 2008 after it had collapsed under its previous private equity owners.
The business has reportedly cost Ms Cameron another $70 million in operating losses in the past two years alone, while a high turnover of senior management led to Ms Cameron taking the reins last March.
A recent boardroom exodus has also left her as the sole director.
The appointment of high-profile spokesman Grant Vandenberg has not led to any explanation of the recent closures or any response to claims that the company has been behind on its rent and payments to suppliers.
"There's nothing [to report]," Mr Vandenberg told BusinessDay.
Last week Tasmanian publications reported that 12 ChickenFeed stores in the state would close over the coming month with the loss of 120 jobs. This is on top of other recent store closures there.
According to the Retail Adventures website, the company still has 300 stores in operation, down from 350 when Ms Cameron acquired the business in 2009.
Expansion plans had been put on hold while the company slimmed down its cost base — the infrastructure was built to service 1000 stores — to match the scale of the business.
The restructuring led to Retail Adventures closing its four-year-old distribution centre on Sydney's outskirts late last year in favour of its centres in Queensland and Victoria.
Cuts to head-office staff in Sydney early this year were also aimed at reining in costs that were disproportionate to the business, the company said.
The company had plans for expansion of store numbers and products on offer.
"I think the retail environment is very well suited to businesses in our categories. Everybody looks for a bargain when the economy's tough," said Penny Moss, who at that time was an executive director of the company.