Brosa collapses into administration; buyer sought
Brosa, the upmarket online furniture brand, has been placed in voluntary administration, citing a decline in trade since Covid-19 restrictions enabled consumers to shop at physical stores again.
Last February, Brosa’s co-founder and CEO Ivan Lim told Inside Retail the business grew more than 100 per cent last financial year, in line with other online furniture retailers.
Fuelled both by existing customers increasing their order frequency and average order value during the pandemic, and new customers, who sought out online furniture retailers when stores were closed, the company seemed assured of success, its sales tripling.
“There’s still so much growth, and we are really fortunate that we built a leading position as far as a digital-first experience goes for home and living,” Lim said.
But this week the dream was over, with KordaMentha Restructuring commencing a sale process for Brosa, and Richard Tucker and Michael Korda appointed as voluntary administrators.
“The business faced challenges when sales declined after the Covid-19 restrictions were lifted,” said Tucker.
“This caused short-term cashflow pressures after a period of phenomenal growth.”
KordaMentha is seeking expressions of interest in the business as a going concern.
Tucker said Brosa had developed a strong customer base and technological capabilities “that would be an asset to many other furniture retailers”.
“I expect that there will be strong interest in the Brosa business. The company was embarking on a campaign to reduce its inventory holdings and refocus itself as a make-to-order business.”
KordaMentha is planning a stock clearance from the company’s warehouses in Sydney and Melbourne.