H Smith today confirmed it will close its Te Anau and Balclutha H Smith stores and downsize its Gore department store. It will also close Outdoor World at Remarkables Park in
Queenstown.
Late last month, H Smith announced a proposal to reduce its store network and consolidate its operations back to its home base of
Invercargill in order to secure the long term future of its retail division.
H Smith’s Managing Director, Jason Smith, says its an extremely difficult time for the company, its employees, suppliers
and customers.
The company has been significantly impacted by the Covid-19 pandemic. It is also grappling with issues around increasing
wage and compliance costs, store size and scale, an ageing store network in need of capital expenditure, difficulties
securing supply, new entrants to the NZ market and the increasing dominance of multinational chains.
“We’ve carefully considered the options available and the feedback received and remain of the firm belief that our
original proposal to reduce our store network is our best and only viable option,” says Jason Smith.
“It’s not a decision made lightly. We sincerely regret the impact these decisions will have on our employees and the
communities we operate in.
“We acknowledged the efforts of local government officials who have been proactive in assisting with efforts to keep the
stores in their communities, along with the landlords of the affected stores who have been willing to collaborate on
rents and some of the capital works required. However, these efforts don’t resolve all of our challenges,” says Mr
Smith.
The Te Anau and Balclutha H Smith stores will close on 31 July affecting 17 employees (seven in Te Anau and 10 in Balclutha).
The main Gore store will close at the end of August, by which time the company expects to have the fashion store ready
for trading. 27 employees are affected by the downsizing but the decision to retain a presence in Gore enables the
retention of four employees.
Take Note Gore, which includes NZ Post and Kiwibank, will also close. Although the company is aware NZ Post and Kiwibank
are actively pursuing options for relocating within the town. A total of seven employees are affected with the hope that
some, or all, will transfer with Kiwibank and NZ Post.
Outdoor World in Queenstown’s Remarkables Park will also close at the end of August, affecting 10 employees.
“We will be making every effort to redeploy staff, where that works for individuals,” says Jason Smith.
‘If there is an opportunity to redeploy staff in ongoing operations, this will be considered for displaced staff for
whom this is a practical option.
“All employees will receive all wages, holidays and redundancy compensation as per their employment agreements. Those
with no redundancy entitlements will receive a good faith payment,” says Jason Smith.
Decisions on the future of the H Smith stores in Dunedin and Mosgiel are yet to be fully confirmed and options are still being investigated.
Announcements on these stores will follow in due course.
The other businesses operated by the H & J Smith Group, Mitre 10 MEGA in Invercargill and Queenstown and Laser Electrical in Invercargill are not affected by
the restructure.