The Fat stores which have championed independant fashion design in Melbourne for 14 yrs have been thrown a lifeline after going into administration last month. Photograph at the Fitzroy store.
16th October 2012
Simon O'Dwyer
The Age Newspaper

Fashion chain Fat (Fitzroy store, above) went into administration last month. Photo: Simon O'Dwyer

ICONIC Melbourne fashion retailer Fat has been thrown a lifeline after becoming the latest independent fashion house to go into administration or close down in recent months.

The five-store boutique fashion chain which has helped launch some of Australia's most successful independent fashion labels, including Sass and Bide, Gorman and Alpha60, has been rescued from the brink of collapse by Parque Pty Ltd, the investment group behind Laura Ashley Australia.

The near demise of the pioneering indie fashion retailer comes just months after the closure of local labels Vixen, Body and childrenswear brand Big by Fiona Scanlan, casting a pall over the future of independent fashion in Australia.

It also follows the recent rescue of Melbourne labels Claude Maus and Bettina Liano, which went into voluntary administration last year, by private retail groups Factory X and the Apparel Group, respectively.

Fat co-founder Rachael Cotra, who has been championing local fashion since the first Fat store opened 14 years ago, told The Age the company's financial woes were caused by a perfect storm of increased competition from online and new international players, such as Zara and Topshop, as well as poor consumer confidence.

Minutes from a recent creditors meeting revealed Fat owed more than $1 million when it went into administration.

''We were finding that items at that lower price point were still selling well but there were fewer shoppers willing to pay for those more expensive pieces,'' Ms Cotra said, adding that the new owners were committed to supporting local designers.

The main selling point for Australia's independent labels has been their point of difference. Typically produced in limited runs, they offered shoppers an alternative to chain store fashion, but at a higher price.

Independent fashion stalwart Jenny Bannister, who was forced to shut up shop several years ago, says now that consumers can find that difference on overseas websites, it is becoming increasingly difficult for boutique brands to survive.

''It's really difficult to find those independent labels here now. Everyone is too scared to sell it because of the high price tag and the fear that no one will buy it,'' she says. ''It's great that Fat has been saved because there are not many like them left.''

RMIT University's program director of fashion, Karen Webster, says the changing retail landscape means more independent labels will be taken over by bigger corporations.

''We are seeing it more and more and I think if these brands want to … compete now then they will have to join forces with those businesses who have the infrastructure and expertise that's needed now.''