Australia’s largest online shopping site could close down in the next two weeks after facing fierce competition from cheaper rivals.
Barely a year ago, Australian shopping centre BigWigs was the country’s most popular shopping site.
It boasted a massive online presence with hundreds of thousands of visitors a day, but it was facing a tough time in the early days of the digital age.
BigWigs has been struggling for years to make a profit, with its revenues lagging behind competitors like Taobao and Alibaba.
In the year ending June 30, it posted net loss of $2.3 million, while revenue dropped more than 25 per cent.
BigWigg’s financial results were leaked last week, and some analysts predicted it would close.
It was a grim time for the Australian online shopping giant, which is in the midst of a restructuring of its operations.
Brawls, a company that sells digital accessories to businesses, will take over BigWig’s business.
But the company is already under threat.
Taobai, the Chinese e-commerce giant, bought a 20 per cent stake in Barely Aussie in June.
Taobea, a Chinese online marketplace that also sells accessories, has taken over the company.
While Taobeas shares jumped 30 per cent, they were still down from the company’s highs before the takeover.
Taoboa’s stock has since fallen nearly 50 per cent to $3.50.
Barry Shearer, a former head of retail at Australia’s Fair Trading Authority, said it would be tough for BigWogs to survive a sell-off like that.
“You’d expect that the retail sector would go into freefall, it’s not going to last forever, but the internet industry is pretty resilient, so it could be a really tough year for the company,” Mr Shearer said.
“It’s been a rough year, it is going to be a tough year, but that’s just the way it is.”
It’s not the only shopping centre to struggle in Australia.
Last week, online shopping hub Alamo said it was shutting down its online store in Victoria.
The company, which was based in Melbourne’s inner west, was run by the owners of a Melbourne company.
Alamo had to shut its online shop in April due to a lack of demand.
In July, online retail giant Amazon announced it was closing its online stores in the Australian states of New South Wales, Queensland and Victoria.