The 146-year-old G&T Young jewellery store in George St faces the possibility of closure by mid-January, unless last-ditch efforts revive its flagging fortunes, director Roy Young said yesterday.
The store is believed to be New Zealand's oldest jewellery business, having operated continuously in Dunedin since 1862.
Mr Young said a "very quiet" winter had hurt the business, with turnover down by "serious numbers" and the situation had not improved.
The store's fate - and that of its two full-time and three part-time employees - now rested on Christmas trading.
"I'm fighting to survive," Mr Young, who bought the business from his father in 1996, said.
"If I have a good Christmas I'm right. If I have an average or quiet Christmas, I'm in trouble."
He had slashed prices - in some cases by up to 70% - and reduced staff hours in an effort to boost the business.
Other retailers were facing a similar predicament, he said.
"You ask any of the independent retailers. You can see it in their eyes. There's terror in their eyes. That's the best way to describe it."
Last month, the Otago Daily Times reported George St retailers were feeling the economic pinch to varying degrees, although none was prepared to say exactly how hard they had been hit.
While blaming the economic climate for the majority of the store's woes, Mr Young yesterday also criticised the Dunedin City Council's $34 million Wall Street retail development, which he said would only bring more competition to George St.
"They are taking a certain percentage of that market off everyone else. They are taking sales away from other stores."
Council property manager Robert Clark could not be reached for comment yesterday.
Wall Street project manager Dave Mackenzie - formerly of the DCC and now Zelko general manager - defended the development.
It would bring wider economic benefits to the city, including employment for the contractors and up to 200 people to be employed in its stores, he said.
