The encyclopedia · Strategy & Leadership · Strategic decision · 1995–2019
Dismissing Sephora as a 'non-event' cost Napoleon Perdis its 56-store empire
Perdis called Sephora's 2015 Australian launch a 'non-event'; four years later his 56-store chain was in administration with 600 staff at risk.
Napoleon Perdis Cosmetics · Napoleon Perdis (founder) · 2019-01-31
What happened
Napoleon Perdis opened his first store in Paddington, Sydney in 1995 and built the chain into 56 stores with more than 600 staff, plus a US operation that ran for more than a decade. In 2015 he publicly dismissed the arrival of Sephora — then the world's biggest beauty retailer — in Australia as a 'non-event'.
On 31 January 2019 the directors called in administrators Simon Cathro, Chris Cook and Ivan Glavas of Worrells after months of failing to find a buyer. The chain blamed falling foot traffic and rising costs, and IBISWorld described the cosmetics market as 'mature and saturated', with online shopping and social media pulling customers away from stores.
Creditors were mostly banks and landlords; about 100 staff faced redeployment as 20 to 25 of the 56 stores were expected to close. The first creditors' meeting was scheduled within eight days.
Why it happened
- In 2015 Perdis dismissed Sephora's Australian launch as a 'non-event' — the biggest disruptor in beauty was treated as no threat, and the chain's store model did not visibly change.
- Foot traffic was falling and costs rising in a market IBISWorld called 'mature and saturated', with no room left to absorb either.
- Online shopping and social media had rewired how customers bought makeup, and a chain built on 56 physical stores did not follow.
- The directors spent months trying to sell the business and failed, leaving administration as the only option.
The lesson
In 2015 Perdis called Sephora's Australian launch a 'non-event'; four years later his 56-store chain was in administration. Waving off the market's biggest disruptor did not make it go away.
Aftermath
Creditors voted in April 2019 to hand control to KUBA Investments, represented by China marketing expert Livia Wang, a deal that kept more than 250 staff. The business had already closed 28 of its 56 stores within a week of entering administration. Administrator Simon Cathro said the restructured company 'sets a solid foundation for a profitable and sustainable business going forward'.
Sources
- The Guardian — Napoleon Perdis makeup empire goes bust putting Australian jobs at risk (Jan 31, 2019)
- ABC News — Make-up chain Napoleon Perdis the latest retail brand to enter administration (Jan 31, 2019)
- Inside Retail — Creditors hand control of Napoleon Perdis to private investment firm (Apr 8, 2019)
spotted an error? The club wants to know.
More like this
Innisfree shrank from 13 Hong Kong stores to 5, closing its 12-year Causeway Bay flagship
Cover FX winds down after sales collapse
Aeluna Beauty, an influencer-founded Indonesian makeup brand, closed in December 2024
Somewhere, someone solved the problem this company failed at. 2nd Opinion →
Comments · 0
Sign in to join the comments.