Flannerys health food shops: Gold Coast founded chain bounces back with help from sales during coronavirus pandemic

Just months after emerging from administration, the Gold Coast-founded Flannerys chain has turned its fortunes around. Here’s how they did it.

GOLD Coast-founded Flannerys health food chain had only emerged rattled from a traumatic administration for five weeks when its stores were hammered by COVID-19 panic buying.

CEO Fergus Collins said the “shock” of having to go into voluntary administration left the business bruised, with more than six stores closing and 100 staff being made redundant.

Flannerys owner, The Natural Grocery Company, fell into voluntary administration in November after repeated financial losses and the failure of a turnaround plan.

Mr Collins said the business came out of administration on February 6, after a deal was done with creditors to rescue the company, and by mid-March was facing a very different type of test.

“Nobody saw it coming (the COVID-19 panic buying) and supply chains are not built for that,” he said.

The owner of Flannerys entered administration last year. Picture: Jerad Williams

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“It is like having three Christmases one day after the other and roll Easter on top as well, so everybody was completely hammered.”

Mr Collins said the company had only started to repair its fractious relationship with suppliers burnt by the period of administration when consumers started to empty shelves of flour, rice, vitamins and toilet paper.

“Obviously with the administration … it was a shock to the business and suppliers, customers, the team and the stores,’’ he said.

“We did a lot of work rebuilding the trust with suppliers and then you get smacked with a pandemic. You had a massive spike in demand.”

Flannerys Miami health food store employee Brie Porter. Flannerys has seen a rise in business since the start of COVID-19. Picture: Jerad Williams

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Mr Collins said there were the twin pressures of keeping staff safe from contracting the virus while at the same time keeping supplies coming into the stores, some of which were doing double their normal weekly trade.

Sales of ArmaForce vitamins rose by 250 per cent alone.

“No supplier is sitting on that sort of stock level,” Mr Collins said.

“You put it on the shelf and in five minutes it was gone.”

Mr Collins said the business had been able to rebuild its relationship with suppliers by paying on time and in some cases making early payments.

He said the directors were starting to put money back into the business, with a revamp of the Benowa store underway.

The Flannerys family sold out of the business 12 years ago. Pictured are from left to right: Martin Meek with wife Genevieve and Berice Flannery with husband Mal at the Benowa store.

The company was also listening more to store managers on what products to stock so it could keep up with industry trends.

“The store managers are not like those at supermarkets who basically just give directions. All our store managers are strong advocates of the health foods industry.

“They get it and … you don’t reinvent the wheel.”

He said the changes made to the company’s business model, under which all 200 staff have been moved to permanent or permanent-part time contracts, would lead to a successful future.

“Flannerys has been in the health foods industry a long time,” he said.

“For someone to be around in any industry, particularly something like this, shows there is a base of knowledge and expertise that needs to be brought to the front.”

Mal and Berice Flannery established Mrs Flannery’s – now known as Flannerys Organic & Wholefood Market – on the Gold Coast in 1973 and grew it into a multimillion-dollar franchise business before selling out 12 years ago.

Gold Coast Flannerys stores are based at Miami, Benowa and Robina.