David Jones Faces Existential Threat as Retail Expert Warns of Imminent Disappearance

David Jones, a department store chain founded in 1838, is facing an uncertain future and could disappear "in the very near future," according to retail expert Barry Urquhart. The company has confirmed it is undertaking a review of its Australian store network as it grapples with declining relevance and financial challenges.

Urquhart, managing director of Marketing Focus, stated that David Jones has been losing relevance for decades and is now confronting a critical battle for survival. "The inevitability is we will not be seeing David Jones around in the very near future," he warned.

David Jones confirmed its strategic review includes its store portfolio and its trading terms with suppliers and brand partners. A company spokesperson stated that chief executive Erica Berchtold's priority is to accelerate the existing strategy and that Berchtold is in advanced discussions with stakeholders about adapting to the evolving retail landscape. The retailer declined to comment on media speculation.

The department store recorded a pre-tax loss of $95.5 million for the year ending June 29, 2026, with sales falling by 8.7 percent. Anchorage Capital Partners has been working on a turnaround plan, securing Hilco as a lender in July and appointing Berchtold as CEO. Hilco, the primary lender, has provided additional funding to increase stock levels ahead of the Christmas trading period and remains supportive of the business.

Urquhart attributed the decline to a long-term shift in consumer behavior and the impact of the COVID-19 pandemic. He noted that department stores peaked in the 1950s, 60s, and 70s and have seen a progressive decline since then, exacerbated by the rise of online shopping and specialized competitors. The pandemic, with its widespread closures, significantly impacted retailers' cash flows and debt levels.

He pointed to increased competition in traditional strongholds like cosmetics and perfumes, citing retailers such as Chemist Warehouse as offering comparable products at lower prices. Urquhart suggested that the closure of David Jones would have minimal impact on most Australians, estimating that "95 percent of Australians would not know and would not be impacted."

David Jones' current network of 39 stores, with an annual turnover of approximately $2 billion, is seen by Urquhart as being in a difficult position – "too small to be big and they're too big to be small." He speculated that selling some stores to rival Myer could be an option, but acknowledged that overlapping locations might make such a deal unfeasible.

Adding to the pressure, several brands have reduced their presence in David Jones stores. Country Road Group has cut concessions, and luxury brands like Gucci, Chanel, and Dior have withdrawn product lines or scaled back their footprints. In January, David Jones closed its stores at Castle Towers and Tuggerah.

Urquhart described the company as "undercapitalised and under-resourced," questioning the long-term willingness of investors to continue funding the business without reliable returns.