Luxury furniture company collapses as it blames its business woes on growing too quickly through Covid
- Melbourne luxury furniture shop Brosa announced its collapse on Wednesday
- The furniture store blamed its collapse on its ‘phenomenal’ growth in Covid
- Richard Tucker and Michael Korda were appointed as voluntary administrators
A fashionable online furniture and home decor retailer has collapsed with the company blaming the Covid pandemic as the reason for it going under.
Trendy online retailer Brosa announced on Wednesday it had appointed Richard Tucker and Michael Korda of KordaMentha as voluntary administrators, who have since commenced the sale process for the fallen business.
‘The business faced challenges when sales declined after the Covid-19 restrictions were lifted,’ Mr Tucker said.
‘This caused short-term cashflow pressures after a period of phenomenal growth.
‘KordaMentha is seeking urgent expressions of interest in the sale of Brosa as a going concern.’
Luxury furniture shop Brosa (pictured one of their couches) has gone under
The store had a shopfront in Melbourne before going into voluntary administration
Mr Tucker said he expected a ‘strong interest’ in the business, noting Brosa had ‘tripled in size during the pandemic, developing a strong customer base and technological capabilities that would be an asset to many other furniture retailers’.
‘The company was embarking on a campaign to reduce its inventory holdings and refocus itself as a make-to-order business. We plan to continue this process to clear stock,’ he said.
Mr Tucker called on anyone seeking a new piece of furniture to choose Brosa.
‘If you are looking for a new couch, or other stylish furniture in the lead up to Christmas, visit the Brosa website or Sydney and Melbourne warehouses for a great deal,’ he said.
The news follows a recently released City of Sydney business needs survey that exposed stark realities for the local business sector.
The furniture retailer offered plenty of trendy options and was popular among influencers
The report revealed 79 percent of consumer-dependent businesses in central Sydney had seen reduced capacity levels since the pandemic, while half of businesses were still operating at below pre-pandemic capacity.
More than half claimed they were worse off in 2022 than in 2021.
The hardest hit industries have been hospitality, retail and tourism according to the December 1 report.
The latest ABS Business Conditions and Sentiments report in June painted a similarly bleak picture, with a third of Australian businesses having had difficulty finding staff, 46 percent reported an increase in operating expenses, and more than two in five faced supply chain disruptions.
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