Mass sackings as beauty chain Body Catalyst nears collapse

Body Catalyst, the 34-clinic cosmetic medicine chain that has collapsed into administration, made around half of its 250-strong workforce redundant in the past year, according to a company insider.

The female staff member, who wished to remain anonymous, reached out to news.com.au after we revealed yesterday that the chain had fallen into administration.

She said that when the company shut 11 clinics in May, in a last-ditch effort to save itself, staff were worried and the closures led to “lots of redundancies and resignations”.

After administrator Alan Walker, from WLP Restructuring took over the running of the business last Thursday, 30 staff were made redundant the following day, according to the staff member, followed by “heaps more redundancies” on Monday and Tuesday of this week.

In total, she estimates around half of the company’s 250-strong workforce had been made redundant in the past year.

The staffer said that it has already been announced internally that four more clinics in NSW will be permanently closed, along with up to three in Queensland and several in Victoria.

The clinics earmarked for closure will trade until Friday December 22, and she added that staff had already been told there would be “no redundancy payments” and that annual leave may not be paid out.

She told news.com.au that two years ago the company was “opening around a clinic a week” towards its aim of a total number of 52 clinics across Australia and New Zealand.

But the insider said that rather than customers cutting their discretionary spending, which was a key reason cited by Mr Walker for the decline of the business, its rapid expansion was to blame, adding they felt the company “got greedy”.

She said that Body Catalyst “secured cheap rents during Covid” and struggled once rents returned to more normal levels.

“We saw this coming,” the staff member said.

Treatment options at Body Catalyst.

Body Catalyst provides non surgical cosmetic treatments such as fat freezing, cellulite reduction, non surgical facelifts, notox, skin rejuvenation, skin tightening, body contouring, pelvic floor strengthening, muscle definer, fat cavitation and treatment for chronic back pain.

The treatments for men and women range in price from hundreds to several thousands of dollars.

The staffer said that majority of its treatments are sold as packages that require a number of sessions, meaning customers may need to travel further to a clinic for treatments they have already paid for if their local clinic is among those scheduled to close.

If the chain collapses into liquidation, customers with packages are likely to end up among its creditors.

Mr Walker said customers concerned about future appointments should contact their local clinic, but any affected customers will also receive communications from the administrators in the coming days.

Administrators hope to restructure the company “in order to save jobs and as many clinics as possible”.

In Victoria the company operates 15 clinics, with 11 in NSW and six in Queensland.

A meeting of creditors has been scheduled for December 19, and Mr Walker said employees, landlords, the Australian Taxation Office and suppliers are among the company’s creditors.

A total of 10 Body Catalyst clinics are located in Westfield shopping centres, so Westfield owner Scentre Group is likely to be among the major creditors along with other large property groups including Stockland and GPT Group.

Creditors can make the decision to put the company into liquidation however Mr Walker said that he is “hopeful the correct decision will be made” and the business can be saved.

SOURCE: NEWS.COM