Nick Scali closes all stores, stands down majority of staff

30 March 2020, Written by Matt Ogg

Nick Scali closes all stores, stands down majority of staff

Furniture retailer Nick Scali (ASX: NCK) has announced it will temporarily shut all stores from the close of business today, standing down the majority of its 500-strong workforce in the process.

The group said it took the decision due to social isolation and distancing measures implemented by governments in Australia and New Zealand, as well as the "increased level of risk for our staff and customers should stores continue to operate".

Stores will be closed until at least 1 May, but distribution centres will continue to operate at normal capacity during April and May to support the delivery of customer orders.

The company has also rolled out the following cost reduction measures:

  • reducing marketing expenses in line with trading;
  • delaying store roll-out and discretionary capex in FY20;
  • engaging with landlords in respect of rent relief; and
  • reducing non-essential general operating expenditure

"The decision we have made today to close stores and stand down loyal team members was not made lightly, but I believe it is the right decision for our people and our Company in the long-term," says Nick Scali's managing director Anthony Scali.

"We thank our customers, suppliers, landlords and most importantly our team members for their understanding and support during this difficult time."

In the company's annual report last year Nick Scali reported a staff count of 515, and in its most recent half year results it noted a store count of 58.

The decision follows similar announcements from other furniture retailers including Matt Blatt and Adairs.

King Living recently announced its showrooms remain open, but with social distancing guidelines implemented along with minimal physical contact between visitors in showrooms.

"King Living product experts will be operating video chat consultations, via Whatsapp, Facetime and Google Duo and all Australian showrooms currently remain open. Please contact your nearest showroom for further enquiries on these services," the company said.

Updated at 6:48pm AEDT on 30 March 2020.

 
Author: Matt Ogg

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