MyCatwalk has introduced a commission-based model for designers, amid reports the fashion etail destination is in financial hot water.
Parent company eFinity Group, owned by investment company AR Management, has reportedly slashed staff numbers and closed brick-and-mortar stores amid falling sales at MyCatwalk.com.au, ThreadPeople.com.au and BabysGotStyle.com.au.
According to a recent report in Australian Financial Review, MyCatwalk co-founder Jon Reid has also take action against AR Management in the NSW Supreme Court, alleging impropriety and breach of fiduciary duty.
Reid's 50 per cent shareholding shrunk to less than one per cent after a rights issue launched soon after AR Management acquired the business.
Documents obtained by ragtrader.com.au reveal MyCatwalk has also launched a commission-based model for designers, ramping up its stock offer without having to invest thousands in seasonal orders.
Select labels can control stock, pricing, copy, photography and warehousing, with MyCatwalk earning commissions on sales.
"The section of the site can be viewed as a concession store within our platform, giving the customer...a broader, deeper or altogether different selection of styles than if the range was to be featured through traditional buying methods," the prospectus read.
This is not the first challenge to hit AR Management, which made a failed bid to purchase Belinda International when it entered administration.
Brands stocked by MyCatwalk include Camilla and Marc, Kirrily Johnston, Acne, Ellery and Bassike.
For more, pick up a copy of Ragtrader's September edition.