What went SO unsuitable with Glue: Two causes behind store’s collapse as fashionable retail chain launches large sale
Experts have blamed the collapse of popular Australian retail chain Glue on high labour costs and a dip in spending due to the cost-of-living crisis.
The company announced on Thursday all 16 stores would be closed by the end of the 2026 financial year.
The decision comes after ongoing financial underperformance and mounting losses for the brand.
An impairment test found Glue had recorded an Earnings Before Interest and Tax (EBIT) loss of $8.4million in the first half of the 2026 financial year. The report also found multiple stores required impairment write-downs.
Gene Tunny, director of Brisbane-based consultancy Adept Economics, said the collapse was likely due to the pressure of meeting high minimum wage standards.
‘The issues here are common to many businesses, including that labour costs have increased – or are relatively high – in Australia compared to other countries due to minimum wages,’ he told Daily Mail.
‘If their costs were lower, they would not be losing as much – that is one of the issues that makes retail difficult.
‘It means entry level workers can be relatively expensive compared to what may be the case in other countries.’
Australian retail chain Glue announced all 16 stores would be closed by the end of the 2026 financial year in a trading update on Thursday
Gene Tunny, director of Brisbane-based consultancy Adept Economics, said the collapse was likely due to the pressure of meeting high minimum wage standards
However, he added that while employees may be earning a steady minimum wage, the high cost of living means that customers are spending less.
‘They’re going to be struggling with real wage declines because inflation has been high,’ he said.
‘Discretionary spending is not as strong as it would otherwise be. Households have been struggling with the fact that living wages have declined.
‘We haven’t had any real wage growth over the last decade or so, which means less discretionary income on goods and services.’
Economy-wide, there were 1,366 insolvencies during December 2025, the third-highest monthly total recorded.
Real wage growth, a key measure of how much workers can actually buy with their pay, remains stuck around 2011 levels despite recent headline pay rises.
The Reserve Bank’s latest forecasts, published in its Monetary Policy Statement on February 3, showed inflation is expected to run faster than wage growth until at least mid‑2027, locking in a further erosion of household purchasing power.
Economists argue the extended squeeze is necessary to bring inflation under control.
Mr Tunny said customers also have less money to spend on retail items due to the high cost of living and a lack of real wage growth in Australia
This all but guarantees that households will tighten discretionary spending this year, further pressuring the broader economy.
The closure of Glue stores, which are known for stocking popular brands such as Nike, Ksubi, New Balance, Adidas, and Birkenstock, has left customers devastated.
‘One of my favourite shops, I buy heaps of things there, what a loss,’ one shopper lamented on social media.
Glue is currently offering a 30 per cent sale on already discounted items on its website, with 40 per cent off t-shirts and shorts.
Accent Group owns and operates a number of major retail chains including The Athlete’s Foot, Hype DC, Platypus Shoes, Skechers and Vans.
It also distributes popular footwear brands such as Dr Martens, Vans, Timberland, Hoka, Superga, Saucony, Lacoste, and Dickies in Australia and New Zealand.
It is understood the conglomerate decided to close remaining Glue stores after five years of ownership to narrow its focus on global brands.
The brand, founded in 1998 by Australian retail entrepreneur Hilton Seskin, was acquired from JD Sports Fashion in 2021.
Accent Group plans to open five new Lacoste stores over the next year after it became the exclusive local distributor of the brand in 2024.
