Flannerys Lane Cove, Bondi closes after company falls into voluntary administration
Two organic grocery stores in Sydney have closed with another four at threat of closure after the company entered into voluntary administration.
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One of Sydney’s largest organic grocery outlets has fallen into voluntary administration – sparking the closure of two stores and casting doubt over four others across the city.
Closed signs have gone up at the Flannerys food outlets in Lane Cove and Bondi after the company – trading under The Natural Grocery Company – was placed into voluntary administration on Monday.
The company said board members had taken the “difficult decision” to close the outlets due to market pressures and declining profits.
“Continued margin pressure and the broader distribution of health food channel products into the mass market retailers have severely impacted business performance,” a spokeswoman for the company said.
“The company instituted a comprehensive turnaround plan in early 2019 but despite the significant efforts of management, in-store teams and the board, the plan failed to yield the required results.”
The collapse has cast uncertainty over the company’s four other stores in Sydney – Crows Nest, Cronulla, Gymea and Mona Vale.
The company spokeswoman said Flannerys was “aiming” to keep all remaining stores open under a restructured business plan to be discussed in coming weeks.
“The company and its directors are working closely with advisers on a deed of company arrangement proposal to present to the administrator to transition the business into a smaller and sustainable store network,” she said in the statement.
Flannerys was founded 30 years ago and sells various health foods including muesli, gluten free breads and hemp products.
The company spokeswoman said a “large number of employees” would will continue to be employed by the company and “all employee entitlements will be paid in full.”
The closure of the Lane Cove store comes after the site’s previous tenant – Thomas Dux Grocer – was closed in 2016.
A sign on the shop’s doors states “we have relocated” to the Flannerys outlet in Crows Nest.
The closure has generated a flurry of comments on social media, with one resident vowing to launch a Go Fund Me to ensure “emergency supplies of goat milk soap” for the local community.
Fergus Collins has been appointed as acting chief executive of The Natural Grocery Company through the administration process. Timothy Cook of Balance Insolvency has been appointed as the voluntary administrator.