Italian chain Criniti’s is the latest hospitality institution to fall victim to the weak economy and crippled consumer spending after it was revealed the group had fallen into administration.
Employees at the iconic restaurant group were told on Tuesday morning several of the 13 sites across the country will be closed for good but administrators are yet to announce which will survive the dramatic reshuffle.
Worrells Solvency and Forensic Accountants have been tasked with handling the administration of the restaurant group which comprises 40 companies involved in the operation of venues across Sydney, Melbourne, Perth and Brisbane.
“Criniti’s is a well-known, well-liked chain, but like all hospitality businesses carries high overheads and is susceptible to any weakening in retail spending,” Worrells partner Graeme Beattie said.
“With some locations in the group doing better than others, our first priority will be the preservation of value by identifying and closing the poorer performers, of which we expect there to be several.
“These will be difficult, regrettable but necessary decisions made solely because we don’t believe the group as a whole can trade indefinitely while a buyer is found or some other solution is reached, perhaps via a Deed of Company Arrangement”.
A team member at a Criniti’s Perth restaurant said staff were sacked on the spot on Tuesday and were told five other restaurants from the more than 15-year-old business would also be closing for good.
“It came as a massive shock. I have not stopped crying since last night,” she told Daily Mail.
“It’s weeks before Christmas and I have been left without a job.”
“Some of the staff have families and children and we have been told not to expect being paid this week.”
The former employee told the online publication staff at the restaurant had suspected an issue with the company’s performance based on issues paying suppliers.
She said there had also been a recent reshuffle among the leadership but no one expected the end would come so abruptly.
Mr Beattie said there’s never a good way to deliver bad news to workers.
“We understand the shock, disappointment and trepidation felt by Criniti’s loyal staff,” he said.
“While of little consolation to affected employees, by acting quickly to stem losses we are giving remaining employees a better prospect of ongoing work and all creditors a greater chance of being paid”.
Outstanding gift certificates may not be honoured for the restaurant chain, with Worrells expecting to contact affected customers later this week.
AUSSIE RETAIL IN TROUBLE
Criniti’s is just one of many Australian retailers to have run into trouble in 2019.
In January, menswear retailer Ed Harry went into voluntary administration, and a week later, Aussie sportswear favourite Skins also revealed it was on the brink of failure after applying for bankruptcy in a Swiss court.
At the end of the month, the Napoleon Perdis beauty empire announced the cult make-up chain’s 56 Aussie stores had closed for a stocktake. Administrators were appointed, and scores of stores have since collapsed. Five stores have now closed, leaving some workers without a job.
Footwear trailblazer Shoes of Prey also met its demise this year, along with British fashion giant Karen Millen, which in September revealed it would soon shut all Aussie stores, leaving around 80 jobs in peril.
Last month, celebrity chef Shannon Bennett’s Melbourne burger chain Benny Burger was also placed into administration followed by seven Red Rooster outlets in Queensland just days later, and then Aussie activewear sensation Stylerunner, which has since been sold to Accent Group Limited.
Just weeks ago it was revealed that popular furniture and homewares company Zanui had collapsed after it abruptly entered voluntary administration, leaving some angry customers in the lurch.
And Muscle Coach, a leading fitness company, has also been put into voluntary administration this month after a director received a devastating diagnosis and the company racked up debts of almost $1 million.
Do you have fond memories of dining at Criniti’s? Comment below or get in touch | @James_P_Hall | james.hall1@news.com.au
