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It’s finally the end of the road for vacuum cleaner retailer Godfreys as administrators announced today that the company would be wound down after failing to find a buyer despite receiving 55 expressions of interest for the embattled business.
Craig Crosbie, Robert Ditrich and Daniel Walley, of PricewaterhouseCoopers (PwC) Australia, revealed late last month that big-name retailers and investment groups were among those expressing interest in scooping up the company’s assets.
However, today the administrators say that “no viable offers to take the business forward as a going concern have been submitted”, marking the end of an era for the company which has been operating in Australia for the past 93 years.
Godfreys’ staff have been told of a planned phased closure of all stores remaining in the group, which on last count totalled 113 after the closure of more than 50 stores in Australia and New Zealand following the appointment of administrators in late January.
The store closures will take place in stages until 31 May 2024, leading to massive job losses including 25 head-office staff which were made redundant today.
Prior to being placed into administration, Godfreys had 600 staff working across 169 outlets.
Administrator Craig Crosbie says that an exhaustive sale process had delivered 55 expressions of interest and six indicative offers.
However, he says these have since been withdrawn or were deemed not sufficient to secure the long-term future of the business.
“This is not the outcome Godfreys had hoped for following a rigorous process to find a purchaser for the business that could keep the store network trading,” says Crosbie.
“In the absence of any further bidders coming forward as intermittent trading continues, the process of closing all remaining stores will progress over the next eight weeks.
“We recognise this is a difficult time for staff, franchisees, and other stakeholders, and we will continue to work closely with all parties to ensure they are informed and supported over the coming weeks.”
The administrators say that Godfreys stores will continue to trade on an interim basis “to provide a reasonable period for the clearance of existing stock’ before notifications of when closures will take effect”.
“Franchisees have been informed that Godfreys can no longer support them from today,” say the administrators. “Franchised stores can trade until 31 March 2024 to realise the value of existing stock or alternatively return stock sold to them during the administration period to receive a credit on amounts owed to Godfreys.”
Godfreys, which also sells commercial steam cleaners and associated products, was established in 1931 by Godfrey Cohen at a time when door-to-door sales dominated the market.
The company is privately owned by the Johnston family, who are descendants of Cohen’s partner the late John Johnson, who first invested in the Godfreys business in 1936.
After his appointment as administrator in January, Crosbie revealed that Godfreys woes stemmed from 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 said.
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