How Country Road went from cult classic to fashion forgettable largely thanks to a cost-cutting decision more than 20 years ago

Country Road is fighting for its future largely thanks to a cost-cutting decision the company made more than 20 years ago, an expert says. 

The once-beloved Aussie brand is in clear trouble, with Country Road Group reporting in March its earnings were down almost 72 per cent at $14.2million for the last half of 2024.

One of its longstanding flagship stores at Sydney CBD’s Queen Victoria Building has shut up shop, as has sister brand Trenery in Mosman, on Sydney’s affluent lower north shore. Another CBD store in Sydney’s Pitt Street Mall is expected to close when its lease expires in three years’ time.

Queensland University of Technology marketing expert Gary Mortimer said Country Road had lost its iconic Australian lifestyle brand status since Woolworths Holdings took a controlling stake in the late 90s.

A cost-cutting move to manufacture offshore gradually eroded its ‘Made in Australia’ appeal and weakened the brand’s authenticity, Professor Mortimer said.

‘Since its launch in the mid-1970s, Country Road clothing was primarily made in Australia, specifically, the iconic chambray shirt which I and nearly every other young man had during that time was made here using Australian cotton,’ he said.

‘The company emphasised its commitment to Australian manufacturing during that time. 

‘Much of that production has shifted to Bangladesh, China, India and Pakistan under new ownership, essentially losing the essence of what Country Road stood for.’ 

Professor Mortimer said a shift to lower prices in the early 2000s to boost sales had signalled to loyal shoppers that ‘potentially the quality is no longer there’.

‘Today, Country Road is a mainstream fashion retailer, medium pricing, mostly offshore manufacturing and now competing with other middle-market mainstream fashion retailers,’ he said.

‘They haven’t brought their core customers along on a journey. 

‘Essentially those customers, like I, who were buying Country Road in the mid-1980s, are now aged in their 50s and are shopping different brands.

‘Unlike RM Williams, who acknowledged an ageing core customer, and actively began targeting 25-35 year olds to fill that gap Country Road haven’t revitalised their brand.’

Consumer behaviour analyst Barry Urquhart advised Country Road founder Stephen Bennett on the brand back in its heyday. 

Founded by Bennett in Australia in 1974, the business began in Hawthorn, Victoria, with the first standalone store opening in nearby Armadale. 

Bennett’s vision was to create quality clothing designed for an Australian way of life, with the classic cotton chambray shirt released in 1984 an enduring wardrobe staple. 

Mr Urquhart said this laid the foundation for the brand’s success as a lifestyle brand, at times referred to as the Ralph Lauren of Australia. 

The company expanded to the USA in the 1980s and by 1987 was listed on the ASX.  

Last year it marked its 50th anniversary.  

A year on from that milestone birthday, Country Road is on the brink of collapse, Mr Urquhart said.

‘The brand has left itself exposed and vulnerable,’ he said.

‘It’s lost its Australian accent, its identity and point of difference.’

Mr Urquhart said the brand could survive but it would need a lot of investment.

‘The answer doesn’t lie with loyalty programs,’ he said.

‘It is imperative that the Country Road brand articulates its values and defines its unique and differentiated market position.’ 

Mr Urquhart said the brand needed to formulate and project a compelling statement to stimulate relevance and demand. 

‘The brands, bricks ‘n’ mortar stores and product range need to promote the emotive and subjective attributes of touch, smell, colours and look,’ he said.

‘Fashion is a moving feast. Country Road needs to be dynamic, malleable and compelling.’ 

Professor Mortimer said to survive, Country Road should follow RM Williams’ strategies to innovate ranges and target a younger market.

He said the company, which has blamed its poor sales results on a ‘retail recession’ it claims hasbeen running for two years, should also collaborate with iconic Australian and First Nations designers and commit resources to Australian manufacturing. 

Since news broke of its flagship store closing in Sydney, the company assured customers that its retail footprint is being expanded in Sydney, Brisbane, Melbourne and Adelaide.

‘From time to time, we review our retail store portfolio to ensure we’re continuing to meet the needs of our customers,’ a spokesperson told Daily Mail Australia.

‘We are committed to delivering great experiences throughout our networks and we are investing in our stores, with 10 new or refurbished stores opening by the end of the year.’

Country Road Group has been contacted for further comment.