Vacuum and cleaning retailer Godfreys Group has appointed voluntary administrators amid a struggle with profitability and sales.

The move will result in some store closures and redundancies in coming weeks in New Zealand and Australia.

Stephen White and John Fisk, of PricewaterhouseCoopers (PwC), have been appointed administrators of New Zealand Vacuum Cleaner Company Limited, which is part of the Australian-owned Godfreys Group and operates the group’s New Zealand retail stores.

Godfreys Group’s Australian entities also entered voluntary administration today.

The administrators will be seeking to sell the business and its assets as a going concern.

“John Fisk and I will be working closely with the Australian administrators and Godfreys Group management to continue trading the restructured New Zealand store network during the administration in order to maximise the prospects of a going concern sale,” White said.

In a statement, Jane Allen, daughter of Godfreys co-founder, the late John Johnston, and family spokesperson said the company had a proud trading history spanning more than 90 years.

“The Godfreys Group is deeply saddened to announce today that it has made the very difficult decision to appoint voluntary administrators.”

The business was still suffering from the disruptions of the Covid-19 pandemic, she said.

“Like many retailers, we have been heavily impacted by consumer confidence and spending due to the economic era of high inflation, rising interest rates, and intense cost of living pressures.

“Despite our best efforts to improve profitability… Godfreys has been hit by conditions beyond our control, including the weakness in discretionary spending by consumers, which has had an ongoing and significant impact on sales.”

The New Zealand arm of the Australian business – New Zealand Vacuum Cleaner Company Limited – made a profit for the year to July 1 in 2022 of $1.78 million, up from a loss of $1.17m in the prior financial year.

Allen said her father John had re-entered the workforce aged 100 after her family bought back the company under private ownership in 2018.

“He valued our employees, many who have been with us for up to four decades. Godfreys’ employees and customers are at the heart of everything we do and it’s a very emotional time.”

Godfreys was established in Australia in 1931 and is one of the world’s largest vacuum retailers and suppliers of specialty commercial floor care and associated cleaning products in New Zealand and Australia.

The administrators said Godfreys operates 141 stores and employs more than 600 staff across Australia and New Zealand. It also has an additional 28 stores run by franchisees.

In New Zealand, there are 16 company-operated and nine franchised stores.

During the administration period, the Godfreys business will continue to trade while PwC undertakes an operational restructure and sale process.

A number of stores will be closed during this time. Administrators anticipate that approximately five of these will be company-owned stores in New Zealand.

The administrators will be briefing staff and contacting customers, suppliers and other stakeholders in the following days to update them on the impact of the administration and outline the process.

 

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