The collapse of the multi-brand luxury e-commerce retailer is not merely a story of shifting consumer preferences. At its core, this is a legal and financial reckoning. The wave of restructurings and bankruptcies that have swept across the sector – from SSENSE’s recent bankruptcy filing to Farfetch’s striking demise – expose a structural reset shaped by increased luxury brand control, the post-pandemic fading allure of e-commerce, rising logistical and tech costs, and the brutal economics of platforms that were fueled by excessive capital raises.
As aspirational demand cools and shoppers return to stores (or continue to shift spending toward travel, wellness, and other experiential categories), luxury brands have tightened their grip on distribution, cutting back on wholesale and reserving their strongest assortments for their own channels. For multi-brand platforms, already squeezed by thin margins, this retrenchment – paired with unsustainable, capital-intensive expansion strategies – hollowed out the model, leaving them financially and legally exposed.
The Downfall in a Nutshell
> SSENSE sought creditor protection under Canada’s Companies’ Creditors Arrangement Act late last month.
> LuisaViaRoma entered court protection in Italy in August 2025, disclosing debts owed to more than 1,200 creditors.
> Matches went into administration in the U.K. in March 2024, before being shuttered by July.
> Farfetch entered liquidation in the Cayman Islands in February 2024, just weeks after its $500 million emergency sale to Coupang.
> Saks Global, formed in 2024 from the merger of Saks Fifth Avenue and Neiman Marcus, faces tight liquidity, delayed vendor payments, and strained supplier relationships.
> Yoox Net-a-Porter was offloaded by Richemont to Mytheresa in April 2025 in a deal that paled next to the €5.3 billion valuation that Richemont paid for YNAP in 2018.
The Architecture of Collapse
Looking beyond the shifting landscape of consumer purchasing behavior, which has been playing a significant role in the luxury market for years, several legal and regulatory dynamics help to further explain why the once-heralded multi-brand e-commerce retailer model broke.
Luxury brands have steadily curtailed wholesale in favor of direct-to-consumer sales through their own stores and e-commerce sites. When they do still engage with third parties, the terms strip retailers of flexibility: assortments are tightly curated, pricing is tightly controlled to avoid discounting, marketing is limited to brand-approved imagery and placement, and territorial restrictions bar cross-border resale. Payment schedules have shortened, while concession-style arrangements increasingly shift the risk of unsold inventory and high returns back onto the retailer.
What once gave these platforms an edge – aggregating inventory, driving sales with promotions, and marketing across a breadth of brands – has been contractually eroded. Multi-brand retailers are no longer indispensable intermediaries but vulnerable middlemen, left with little leverage just as regulatory and financial pressures intensified.
European law has amplified this shift to an extent by enabling luxury suppliers to restrict sales through selective distribution agreements – a framework repeatedly upheld by the Court of Justice of the European Union. These provisions allow brands to prevent discounting and unauthorized resale, further limiting the ability of multi-brand retailer platforms to compete.
Trade regulation has also reshaped viability. The repeal of the U.S. de minimis exemption on August 29, which ended duty-free imports on packages under $800, fundamentally altered the economics of cross-border e-commerce. Platforms like SSENSE and LuisaViaRoma, built on shipping thousands of small parcels into the U.S., suddenly faced tariff obligations that erased their cost advantage. This regulatory shock underscores how exposed cross-border e-commerce remains to trade law shifts, with insolvency proceedings serving as the pressure valve once compliance costs overwhelm liquidity.
Finally, the end of cheap capital has been decisive. Throughout the 2010s, ultra-low interest rates and abundant private equity and venture funding allowed platforms to raise billions despite sustained losses. That dynamic reversed in 2022 as central banks tightened policy, credit markets hardened, and investors demanded profitability. Stricter covenants left companies with little flexibility, and breaches became triggers for creditor action, accelerating collapses that might once have been delayed.
Farfetch offers the clearest example on this front: the José Neves–founded platform raised billions through debt and equity but burned through more than $1 billion in cash since its 2018 NYSE listing without achieving profitability. When refinancing became prohibitively expensive, its cash cushion quickly disappeared, forcing an emergency sale to Coupang in December 2023 and, soon after, liquidation of its holding entity in the Cayman Islands and enduring allegations of securities fraud and executive misconduct.
What Comes Next
The unraveling of these platforms underscores that the crisis is not temporary – or overly surprising – but structural. Multi-brand e-commerce, once positioned as the future of luxury distribution, has been destabilized by a convergence of legal and financial realities: brands exercising distribution control, suppliers tightening contract terms, regulators dismantling duty-free arbitrage, and creditors unwilling to underwrite persistent losses.
The survivors will be those who adapt their legal and financial structures accordingly. Segregating off-price from full-price channels is no longer optional; it is a contractual and regulatory necessity to preserve brand integrity. Building localized inventory pools is not just a logistical efficiency but a legal response to tariff regimes. And cultivating direct relationships with high-value clients is both a commercial and financial hedge against reliance on fragile wholesale contracts.
The era of growth-at-all-costs is over. What follows will be a leaner, more legally and financially disciplined market in which operational control and contractual clarity determine survival. The story of SSENSE, Farfetch, Matches, and their peers is not just one of failed business models – it is a case study in how law and finance, working in tandem, have reshaped the boundaries of luxury retail.
Share
