Well-known retailer Smiths City has been placed in voluntary administration.

The chain is a popular furniture and electronics retailer, with a large presence in the South Island.

The company, which was founded in 1918, has nine stores across the country and an online store.

Administrators BDO, said the company had faced increasing financial pressures amid a challenging economic environment.

Despite closing some stores and further cuts, falling sales led to company director Colin Neal making the decision to halt trading.

BDO said as of Tuesday morning, all nine Smiths City stores and the online store had been temporarily closed for business to allow administrators to undertake an urgent review of the company's financial position and next steps.

They said the aim was to reopen stores later this week.

Customers who had paid deposits for purchases would be contacted by the administrators over the coming days.

Historic firm with recent troubles

Smiths City was founded in Christchurch by Henry Cooper Smith in 1918, and initially focused on agriculture and general goods, before focusing on furniture, and later electronics and appliances.

It was floated on the stock exchange in 1972 but was forced into receivership during the Covid-19 pandemic.

At the time, it had 34 stores throughout the country and employed more than 450 people.

It was relaunched after being sold to the investment fund, Polar Capital, for $60 million in May 2020.

As part of that relaunch, the company underwent a significant rebrand and opened three new stores.

However, Smiths City's financial redemption was short-lived and signs of trouble began to re-emerge earlier this year with news of store closures.