‘You don’t buy a TV to eat’: Smiths City closes stores in a new sign of the economic times
Friday, 22 August 2025
They have been around 100 years but Smiths City has been forced to downsize its business.
The big box retailer has already closed five stores in 2025, with one further store about to shut.
Retail NZ said it had been a harsh winter for retailers across the board.
Big box retailer Smiths City has announced it is downsizing after its business dropped 40% from two years ago.
The company, which has been around 107 years, specialises in furniture and appliances.
However, things are tough, and as reported by Aimee Shaw in The Post, the company has opted not to renew the leases on five of its stores.
Stores in Nelson, Blenheim, Wellington, Palmerston North and Tauranga have already closed, while the Wānaka store is in the process of shutting up shop.
At its height, Smiths City had 35 stores; now it has only 11.
Speaking to The Post, Smiths City owner Colin Neal was blunt in his assessment of the situation. “Retail is tough,” he said.“It’s the economy … you don't buy a TV to eat.”
“We've reduced staff at head office, we've reduced staff in stores. We’re just doing business as usual, trying to do best in our environment,” Neal said.
His views are backed up by Retail NZ, whose Chief Executive, Carolyn Young, told The Post that retailers “were doing it tough”.
Stuff columnist Verity Johnson wrote of her own challenges as a small business owner today.
The Government maintains that improvement is coming as interest rates continue to fall putting more money in peoples’ pockets.
What do you make of the economy? Tell us in the comments below.
The latest monetary policy statement from the Reserve Bank released earlier this week painted a more sobering picture this week. Stuff’s Lloyd Burr wrote about it here.
Some of the things mentioned included a global economic environment that was “increasingly difficult and costly to navigate” and businesses that are “facing rising costs,” the statement said.
The Reserve Bank also said there’ll be a slower recovery in domestic spending than would otherwise be the case, while pointing out that the labour market remained soft”.
“Some businesses have reduced staff numbers or hours and some others are planning to do so,” they said.
On Wednesday, the Reserve Bank cut interest rates to 3%. This was the seventh cut to rates since the OCR peaked at 5.5% around a year ago.
Despite this, Finance Minister Nicola Willis says an economic recovery is on the way.
“Look at what all of the economists and the data are saying. It is objective data that says things are absolutely getting better, and you should feel confident about that.”
It has been a tough few years for retailers, with many businesses shutting up shop.
Numbers released to Stuff in June by MBIE (Ministry of Business, Innovation & Employment) showed that the number of retail business closures in the three years between 2021 and 2024 had nearly doubled from 2704 to 4167.