National retail chain Johnny’s Furniture collapses

National retail chain Johnny’s Furniture collapses
  • PublishedJune 10, 2024

A national retail chain with stores across Australia has collapsed with customers left anxiously waiting to see what will happen to lay-by purchases and store credit or gift vouchers.

Retailer Johnny’s Furniture, which three stores in NSW, four across QLD and one in Victoria, were sent into administration due to a “significant decline in revenue”.

Shumit Banerjee from insolvency firm Westburn Advisory has been appointed to handle the administration.

Some customers arrived at Johnny’s Furniture stores only to discover the business had gone under.

They were handed a letter on behalf of administrators announcing an “urgent assessment of the business was being undertaken” and a sale or recapitalisation of the company was being considered.

“The director of the company has indicated his desire to honour store credits and lay-bys, and we are currently working with the director regarding same,” the letter read.

“I am currently continuing to trade the business in a limited capacity. We sympathise with customers with unfulfilled orders and ask for patience while we undertake our urgent assessment.”

Creditors owed money include lenders, staff, customers, the ATO, related parties and other government revenue offices, according to Mr Banerjee.

One customer was Gold Coast woman Alana Boland, who paid $950 towards an $1800 new lounge in November last year.

She turned up to the store last week only to discover the company had been put into administration.

The new homeowner said she had requested a refund back in April but never received it.

“I’ve just bought my first home for myself at 27, I’ve got a mortgage and I was looking forward to getting a new lounge – it kind of opens your eyes to the bad things in the world,” she told the Gold Coast Bulletin.

Johnny's Furniture which has stores across Australia has collapsed. Picture: Facebook

Johnny’s Furniture which has stores across Australia has collapsed. Picture: Facebook

Mr Banerjee said he anticipated providing customers with a further update in two to three weeks.

“Whilst my appointment is in its infancy, my preliminary investigations indicate that the company had a significant decline in revenue during the 2024 financial year, which likely contributed to the director’s decision to place the company into voluntary administration,” he said.

It comes at a torrid time for retailers as the cost of living crisis crunches customer’s disposable income, with a number of companies collapsing this year.

Johnny's Furniture sold a range of products. Picture: Facebook

Johnny’s Furniture sold a range of products. Picture: Facebook

High profile vacuum cleaner retailer Godreys fell into administration in January and creditors owed $45 million are set to see none of their money back.

It’s collapse resulted in all 160 stores being closed and online operations shutting down at the end of May, while approximately 635 staff were set to be left jobless.

There were also 25 customers that had been left $18,000 out of pocket, the administrators report filed with ASIC revealed.

In April, a number of retail stores in a major national chain called Totally Workwear collapsed after landlords repossessed the premises, while staff have been terminated from their roles despite still being owed their final wages.

Last month, a high-profile Australian fashion label Dion Lee Enterprise that dressed the likes of Taylor Swift and Dua Lipa went into administration, while an Australian start-up called Bardee that landed its products on Bunnings’ shelves was court ordered into liquidation.

SOURCE: NEWS.COM

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