I cut past the glow of the Louis Vuitton displays and sidestep Armani, Hermès and Prada, all while being hit by the mingling fragrances on the ground level at David Jones.

A series of escalators at the heart of its flagship Sydney store carries me to the menswear department, where I’m greeted by Ralph Lauren and Tommy Hilfiger.

I see signs promoting a price match, a concession made after David Jones followed mass-market retailers into the suburbs and began stocking the same products shoppers can find elsewhere.

The arbiter of Australian taste abandoned prestige for size, after wrongly believing it could be both exclusive and everywhere.

Now the 188-year-old has collapsed into administration after it fell behind on rent, and emergency talks between the David Jones owner, Anchorage Capital, and lenders and landlords unravelled.

The receivers FTI Consulting, which has taken over operational control as the business gets prepped for sale, has issued an ominous warning that “difficult decisions” must be made.

About 6,000 staff spread across a network of 38 stores face uncertain job prospects, not knowing how long the department store will be able to keep its doors open and Christmas-light displays on.

Some of the most unprofitable stores – typically in outer suburban and regional locations – are at risk of imminent closure.

The way back, according to retail experts, is a radical retreat to a tight network of premium stores in prime locations, which would involve cutting the number of stores.

While that reimagined footprint could save the business, it will hinge on an uncertain administration process whereby different stakeholders vie to protect their interests.

“If it survives this, in five years or so, it wouldn’t surprise me to see 12 to 15 David Jones stores,” says Retail Doctor Group’s chief executive, Brian Walker.

“A smaller, reimagined business could be quite profitable.”

Scaling exclusivity

Many retailers have been through a torrid decade, with online buying habits ushered in by Amazon proving to be an existential threat to department stores around the world.

Retailers like David Jones, however, were supposed to be immune because they were seen as high-end shopping destinations that could not be replaced by online carts.

That confidence proved misplaced, with similar-era peers including Lord & Taylor in the US having already succumbed.

David Jones has cycled through almost every type of ownership model, from public listing to foreign conglomerate ownership and now private equity, with most of those models favouring profit through expansion.

But there is an uncomfortable question as to whether an institution built on exclusivity was ever designed to be scaled across suburban shopping centres.

Walker says the distress at David Jones has been caused by its large lease commitments at under-performing sites.

“Suddenly David Jones was trying to appeal to the mass market to keep this machine fed by mirroring the growth of shopping centres into the suburbs,” he says.

“The store network needs to recalibrate.”

The receivers will want to keep David Jones trading through the Black Friday and Christmas rush, a critical period when customers will inject desperately needed cash into the store network, as administrators search for a buyer.

The process could provide an avenue to shed lease commitments at unprofitable stores and push through widespread job cuts.

‘Death by a thousand cuts’

Many Australians have a view on what type of customer service they expect at David Jones, with some longing for the white-glove service of a past era.

The RMIT University advertising professor Robert Crawford says there can be a clash between a customer’s memory of what it was like to go to David Jones decades ago and the reality on the shop floor.

“For a business model that established service as a key part of its unique selling proposition, when you go in there and don’t get that, people are getting understandably annoyed, and this hasn’t just appeared overnight,” Crawford says.

“It’s been a bit of a death by a thousand cuts.”

Part of the awkwardness is that David Jones now resembles what some analysts describe as “generalist luxury”, a segment of the market where customers are not certain what type of service, or product exclusivity, they should expect.

For example, in 1948, David Jones hosted an in-store Christian Dior parade, which was the first collection of the French fashion designer shown outside Paris. Now, those brands have their own standalone stores, and several have removed some of their premier products from David Jones.

Well away from the ground-floor glow of designer bags and imported fragrances, the store settles into decor that is pleasant enough but is not a destination.

I sit near Polo Ralph Lauren sneakers and Birkenstocks in the men’s department at the Elizabeth Street store on a quiet Monday morning, three days before the collapse into administration.

The service is polite and unhurried but there are few shoppers demanding attention.

A sign advertises the store’s complimentary styling and fitting services for men’s clothing. I check online and the next available appointment at this flagship store is at 2pm. In two weeks’ time.

It is indicative of a retailer caught between the luxury of its past and the financial pressures of its present; an old institution offering personal service – so long as you can wait a fortnight to be measured.