Rise Apparel falls into administration

Importation and wholesale clothing company Rise Apparel has collapsed under a weight of gross financial mismanagement and poor guidance from senior executives, its administrators have concluded.

The Victorian-headquartered company, trading as Turning Point Imports, looks set to face the liquidation block after Australian professional service firm Deloitte was appointed as administrator last month. In a report to creditors, joint administrators Salvatore Algeri and Timothy Norman recommended the insolvent company be placed into liquidation.

"Based on our analysis of the company, it is presently insolvent and unable to pay its debts as and when they fall due," the report read. "

Accordingly, we cannot recommend that the administration end and control be returned to the director."
Wuhu Zhicheng Textile Garments is the worst effected creditor with $157,399 owed to the supplier, while RMIT University, Fashion Forecast Services and Mitch Dowd are also among those impacted by the fallout. Other creditors include garment manufacturer, supplier and exporter Vasan Weaves, childrenswear agent Maddison Freeman and logistics provider Toll Ipec.

Initial investigations into the company's books, records and trading history indicated it had experienced trading problems prior to the appointment of administrators. Among the matters which Algeri and Norman attributed to the collapse of Rise Apparel was a lack of senior management focus on new customers and sales opportunities, reduced margins from increased price competition and a high customer concentration risk with almost all sales going to two major clients.

The company is an extensive service provider for the Australian fashion industry, designing and importing infant's and children's clothing, coordinating warehousing operations, selling and wholesaling to a network of independent and chain-store clients as well as operating two Direct Factory Outlets (DFO) in Moorabbin and Jinderlee. Rise Apparel also owns and distributes under the popular Scooter brand and held a number of childrenswear licenses including Bunnykins, Peter Rabbit, Wiggles and Little Miss Albert.

While Deloitte continued to operate the Direct Factory Outlet sites at the time of press, the product licences reverted back to the licensors following the appointment of administrators.

A second meeting of creditors was held on Tuesday (April 15) at the Deloitte offices in Melbourne. A verdict was not available at the time of press.

By Assia Benmedjdoub