Iconic Auckland department store Smith & Caughey’s set to close

Wednesday, 29 May 2024

Smith and Caughey's Executive Director Tony Caughey discusses the recent news of the closure of the Auckland department store.

Queen Street retail store Smith & Caughey’s are consulting with staff about the potential closure of the 144-year-old store.
Chairperson Tony Caughey said the retail landscape, including the growth of new shopping malls, have contributed to their financial problems.
Consultation with staff is expected to go for five weeks, in which time the company will consider and evaluate staff feedback on the proposal.

Smith & Caughey’s, one of New Zealand’s oldest department stores, could be set to close after 144 years.

The company announced on Wednesday it had started consulting with staff about the potential closure of its retail operations on Auckland’s Queen St and in Newmarket, and its online stores.

This proposal will be under consultation for five weeks, in which time the company will consider and evaluate staff feedback on the proposal. It is set to impact 240 staff members.

In announcing the news, Tony Caughey, chairperson of Smith & Caughey’s, said it was just a proposal at this point and no decision had been made.

However, at the same time, he acknowledged they had spent two years “turning over every rock” to find ways to get the company to where it needed to be.

“We have used international independent advisers, we have looked at making bits smaller and bits bigger, but we didn’t find a solution,” Caughey told Stuff.

Caughey said the store has experienced a 40% decline in revenue in what he described as being due to factors outside their control.

The entrance of Smith and Caughey’s flagship store.

“As a result, the company is trading at a significant loss which is unsustainable. Sadly, we do not believe sales can be restored to levels necessary to continue to operate.”

Caughey said changes to the retail landscape, including the growth of new shopping malls, have contributed to consumers looking away from prestige department stores.

Chairperson Tony Caughey worked at the store as a boy.

He also said the aftermath of the Covid pandemic has led to a reduction in the number of office workers in the central city, while ongoing roadworks and development in the area have been disruptive to shoppers

“There has been huge disruption in the centre of town, with roadworks and people being discouraged to drive their cars in the city”

Smith & Caughey’s has been an Auckland institution for over 140 years.

Caughey added the Auckland CBD had become unfriendly.

“It would be nice to be a more friendlier place to come to. It is a less friendlier place than it could be and there are other places people can go shopping other than coming to town any more.”

Caughey told Stuff everyone was sad it had come to this.

“It has been a deeply emotional time for the people connected to this historic establishment. We are acutely mindful of the impact to staff, customers and suppliers by the proposal.”

“We must be realistic and at the heart of us commencing this consultation process now, is the need to look after all Smith & Caughey’s staff as well as we can, and to operate in good faith.”

On the possibility of a Queen St without Smith & Caughey’s after 144 years, Caughey was confident it would survive.

“Queen Street will continue. It will be in a different form from what it is in now, but it will survive.”

If the proposal proceeds, the company is set to cease operation in early 2025.