Vietnamese food is a cheap way to eat out, but it seems making it costs substantially more, with trendy Sydney tuckshop chain MissChu sliding into voluntary administration on Christmas Eve with more than $4 million of debt.
Founder and director Nahji Chu placed the hawker style chain, which she began in 2009 and has has six outlets in Sydney, including Bondi and Manly into voluntary administration just before Christmas, appointing KordaMentha to run day-to-day operations and see if the company can be salvaged.
Around $400,000 is owed to secured creditors such as financial institutions, with close to 50 unsecured creditors, including the Australian Tax Office, owed $2.5 million.
The figures were revealed at a creditors’ meeting on Wednesday.
Restructuring the business over the past fortnight, with a third of the 180-strong employees made redundant and another 60 moved to contracting and casual jobs has resulted in an additional $1.4 million in employee liabilities, mostly in redundancy payments as well as other entitlements.
KordaMentha spokesperson Michael Smith said that MissChu was trading quite well, but was being crippled by its fixed costs. The sudden closure of the Opera House outlet in April last year also contributed to the company’s trading problems.
“It’s fundamentally a good business,” Smith told Business Insider. “The catering side did extremely well on New Year’s Eve.”
Lao-born Nahji Chu spent four years in a Thai refugee camp as a child and her family came to Australia as refugees in the late 1970s. She founded MissChu as a catering business in 2007 before expanding into hawker-style eateries, opening her first one in Bourke Street, Darlinghurst, in 2009, followed by others around the city. She models herself as “the queen of rice paper rolls”. In 2012, a South Yarra, Melbourne store, then London in 2013. The Melbourne and London MissChu businesses are unaffected by the voluntary administration.
She does home delivery takeaway on electric bicycles with the motto “You ling we bling”.
KordaMentha is looking at selling MissChu’s six Sydney stores and the catering business as a going concern. They will advertise for expressions of interest next week, with indicative bids closing at the end of January, in time for a second creditors’ meeting on February 9.
Smith said there had already been 28 acquisition inquiries and believed such a strong, recognised food brand would sell.
Nahji Chu took to Facebook to thank her customers and say she hopes to regain control of the business, saying:
No doubt the Voluntary administration will prove to be an interesting outcome… I’m in the process of working out how to regain control again so that the business does not fall into the hands of corporate greed with an agenda not aligned with my brand ethos.
Profit for profit sake is not what misschu is about… we are about driving change for the better and we want a franchise model that can facilitate the brand ethos.
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