Image Shutterstock | Esprit is officially bankrupt.
Reading time 3 minutes
July 26, 2024, 16:09
The Dutch branch of Esprit has been officially declared bankrupt by the court in Amsterdam. Curator Erik Schuurs has confirmed that there is currently no prospect of a restart.
Read more below the advertisement
Earlier this week, the last seventeen Esprit stores closed their doors. This happened after parent company Esprit Holdings started bankruptcy proceedings for the Dutch branch and was granted a moratorium by the court. This moratorium has now been converted into bankruptcy.
“Esprit was always an asset and created traffic in the shopping street,” said retail and brand expert Paul Moers in an earlier article in De Ondernemer. The rise of vintage and thrift stores has put pressure on the fashion industry. “Clothing has become such a big deal there,” says Moers. In addition, factors such as the increase in working from home and rising costs play a role. “People now work from home a lot and wear comfortable clothing. In addition, expenses for housing and food take up an increasingly large part of the budget, leaving less for fashion items.”
Esprit has been struggling for years with changes in the textile market and rising costs. The Dutch branch did not have enough resources to continue. Competition from online platforms such as Shein and Temu, which offer clothing at very low prices, makes it even harder for traditional stores such as Esprit. “These platforms bypass intermediaries and do not pay attention to environmental or labor conditions, which allows them to sell at dumping prices,” Moers said.
Read more below the advertisement
Also read: Why brands Esprit, Scotch & Soda and Superdry are not making it and Omoda and PME Legend are
Like brands such as Scotch & Soda and Bristol, Esprit has faced rising costs due to inflation, high energy prices, labor costs and logistical problems. “Bristol has failed to establish a relevant formula,” Moers said earlier. “And now it’s too late.” According to him, successful brands such as Vanilia have proven that physical stores can still thrive if they invest heavily in marketing and the shopping experience. “Vanilia offers top service and a unique presentation of their products, something that Esprit unfortunately failed to do.”
Esprit Holdings Limited previously announced that it is working on a sustainable future for its European branch by making the brand more efficient and cutting high costs. Outside the Netherlands, Esprit filed for deferment of payments for parts earlier this year. In May, the company started a procedure in Germany due to extreme cost increases due to years of high inflation and energy prices. The company also referred to a ‘bloated’ workforce (too many employees) and problems in logistics.
Read more below the advertisement
The disappearance of Esprit from Dutch high streets marks a painful reality for the retail sector. Retail expert Dirk Mulder said at the AD: “In the shopping street, it is all about the image of the store and the will to innovate in time.” He mentions examples of successful brands such as Omoda, PME Legend and My Jewellery, which have invested in their stores and the shopping experience and can therefore continue to exist.
