David Jones’ future looks grim. Is Myer next?

Myer's financial struggles have put its future in doubt, prompting speculation that David Jones, its longtime rival, may follow suit. Myer's profitability has been hit hard, and its share price has plummeted to near-record lows. The company, however, maintains a $100 million cash buffer, giving it a slight edge over David Jones, which recently declared bankruptcy.

Myer has been slashing prices and offering deep discounts to attract customers, but this strategy has reduced its profitability. Despite this, the retailer is investing in online sales and working to reduce its store network and lease liabilities. While some analysts view permanent discounting as a risky long-term strategy, Myer is betting on bigger volumes to improve both sales and margins.

The company's financial flexibility, which allows it to avoid the encumbrances that weigh down David Jones, is seen as a significant advantage. Myer's shares, however, have plummeted to a fraction of their 2009 value. With many Myer stores co-located with David Jones outlets, the closure of 19 DJ sites could provide Myer with an immediate market share boost.

However, the overall retail environment is becoming increasingly tough, with rising interest rates and a cost-of-living crisis dampening shoppers' discretionary spending.