JOHANNESBURG — A storied but troubled chapter in South Africa’s retail history came to an abrupt close Tuesday when the 159-year-old department store Stuttafords shut down two of its main stores, including the flagship Sandton City unit in suburban Johannesburg.

By the end of August, nine of its department stores, not to mention 16 monobrand stores and three units outside of South Africa, will be closed. Eight of the largest department store branches — all in prime locations in key malls throughout the country — comprise a total of 330,000 square feet of retail space that is now available, which landlords will struggle to fill.

Once known as “the Harrods of South Africa,” Stuttafords, the posh department store first established in Cape Town in 1858 by Samson Rickard Stuttaford and modeled after the famed London institution, is the highest-profile casualty of the country’s beleaguered retail climate and a victim of its own failure to adapt to rapidly changing consumer shopping patterns and market realities.

When Stuttafords — which posted losses of 35 million South African rand, or $2.65 million at current exchange, in June and July 2016 — was put into business rescue last October, it owed 836 million South African rand to some 280 creditors, with the Estée Lauder Cos. Inc. and Tommy Hilfiger owed the largest amounts among the fashion and beauty suppliers.

The business rescue was intended to allow Stuttafords a respite from paying suppliers while buying time to work out a new plan to save the company. But a series of plans did little to placate creditors, leading to the May announcement that Stuttafords had no other option but to close. Creditors would receive 3 South African cents for every rand owed; 10 South African cents if they were lucky.

Indeed, Stuttafords may just be the tip of the iceberg. Woolworths and Edgars, the other two largest national department store chains, have posted less than stellar earnings, while two smaller retailers, Truworths and The Foschini Group, have been shopping overseas for new acquisitions to boost earnings. Truworths purchased the U.K. high street footwear chain Office Retail Group last year, while TFG acquired Whistles and Phase Eight of Britain.

Dion Chang, founder of trend research and consultation agency Flux Trends, believes Stuttafords’ fall serves as a bellwether of the storm that will continue to hit retail worldwide. Among the factors that contribute to this perfect storm is the sluggish global economy. “It’s worse in SA as we are in a recession,” he said. “The hourglass economy in SA is a harsh reality, especially as retail depends on a narrow, middle class consumer demographic who now have no disposable income.”

Christy Tawii, senior research analyst at Euromonitor International, said the dismal state of South African retail in general and the demise of Stuttafords in particular can be attributed to, among other things, the challenging economic climate that has been affected by low consumer confidence and declining disposable incomes.

Stuttafords and Edgars, she added, were among the credit-offering retailers that experienced slower value growth due to the country’s imposition of stricter credit lending regulations, requiring proof of income. This led to a decline in in-store credit sales, which had previously driven the sales of many of these retailers.

Tawii pointed out that many of the department stores also stock highly priced international brands. “Considering the economic situation, many consumers cannot afford luxury or highly priced items anymore, and are rather prioritizing essential goods.”

E-commerce, Chang believes, has had a slow and steady impact on retail. “It’s still small in SA, but it has changed consumer behavior and methods of shopping. Even though online accounts for only one percent of retail turnover, more and more people are doing pre-shopping and research online, so people either become ‘stealth bomber’ shoppers — get in, get out, no browsing — or simply avoid the malls altogether.”

The real scandal behind the demise of Stuttafords is the infighting between the two wealthy families that were the main shareholders: the Rubensteins, who held 32 percent through their company Vestacor, and the Ellerines, who owned 35 percent through their firm Ellerine Bros. The involvement of the Ellerine family complicated matters even further as it also owned Canal Walk, a shopping center in Cape Town that was also one of Stuttafords’ landlords. The Stuttafords store in Canal Walk occupied some 47,000 square feet of space. Reports have since emerged that the Ellerine family preferred to have H&M rent the space, leading to accusations that it sabotaged its own company’s chances of survival.

Accusations have been flying left and right between the two parties. In short, Chang said it appeared that the two major shareholders could not decide on a way forward or business pivot. “In terms of the business trends Flux tracks, that inertia is the same as business suicide.”

When contacted by WWD, Stuttafords soon-to-be-unemployed chief executive officer, Robert Amoils, declined to comment, citing current circumstances. He was quoted in the South African financial press as lamenting the fact that the shareholders’ agendas had not been aligned.

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