The situation at franchise brand company Allied Brands continues to worsen, with creditors reporting delays of up to six months in getting invoices paid.
The revelations come as liquidators from Sydney accounting firm Smith Hancock place Allied Brand’s Cookie Man chain up for sale, following a NSW Supreme Court winding up order handed down last week.
One of Cookie Man’s creditors is Mark Nicolls, director of confectionery company VooDooo. He told SmartCompany this morning he is owed $3,900, but expects he will be lucky to see $100 when the liquidation process is complete.
Nicolls says he has been struggling to get invoices paid since the beginning of 2010.
“I have been struggling to get paid over the last three or four months. I have been paid [some invoices] but it’s taken a hell of an effort to get my money,” he says.
“All I need is someone to pick up the phone and say, ‘We’re struggling, we can’t pay you for a month or so’. I’ve got no problems with that.”
Nicolls says he has received another order from Cookie Man, and while he has been assured by the liquidators that he will be paid, he won’t be supplying any goods.
“Quite frankly, I just can’t be bothered.”
Sean Corbin was contacted this morning for comment but was not available prior to publication.
However, the problems extend beyond the Cookie Man brand. A franchisee from Allied’s Baskin Robbins chain has contacted SmartCompany to report that they are now being asked by Allied suppliers to help them chase invoices.
In an email seen by SmartCompany, one supplier – who is owed about $4,000 – says they have “been speaking to the accounts department in Brisbane regularly but we don’t seem to get anywhere with them.”
“As we are only a small business we cannot carry this level of debt could you please talk to them to fast track payment for us.”
Allied recently revealed that the US owners of the Baskin Robbins brand, Dunkin Brands, had threatened to terminate Allied’s master franchise agreement for Australia.
The two companies remain in dispute.
Allied Brands shares remain in a trading halt as a result of Cookie Man entering liquidation.
In its latest statement to the Australian Securities Exchange Allied said it “reaffirms that it is in discussions with its financiers with regard the future as a going concern of the group”.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
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