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Vacuum and cleaning products retailer Godfreys Group is expected to let go of almost a third of its staff in Australia and New Zealand after appointing voluntary administrators, following a challenging period of lower demand combined with risings costs.
The administration also applies to all subsidiaries of the group, which was established in 1931 and is one of the world's largest vacuum retailers, as well as a leading supplier of specialty commercial floor care and associated cleaning products in the region.
Craig Crosbie, Robert Ditrich and Daniel Walley of PricewaterhouseCoopers (PwC) Australia have been appointed as voluntary administrators of the group's Australian operations, while John Fisk and Stephen White of PwC New Zealand will carry out the same task across the ditch.
The administrators will continue to trade the Godfreys business while undertaking an immediate operational restructure and sale process. which is expected will lead to the closure of 54 stores within the next fortnight affecting the employment of approximately 193 staff - 171 in Australia and 22 in New Zealand.
This represents roughly a third of its operations that include 141 stores employing more than 600 staff across Australia and New Zealand, as well as an additional 28 stores run by franchisees.
"While the decision to appoint administrators was difficult, it was made with the best interests of Godfreys’ employees, customers and broader stakeholders in mind," says Godfreys director Grant Hancock.
Craig Crosbie of PwC says the administrators will continue to work closely with Hancock management, and creditors, including 'staff whose employment is unfortunately impacted by store closures'.
"Like many retailers, Godfreys has faced a challenging economic and operating environment. Lower customer demand amid cost of living pressures, higher operating costs, and increased competition have all taken a toll on profitability, with some stores more impacted than others," he says.
"Our aim is to move quickly to restructure Godfreys to preserve as much of the business and as many jobs as possible.
"We intend to trade the restructured store network and sell the business and assets as a going concern, with strong interest expected from prospective buyers."
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