Retail empire of Young Rich members Richard and Christina Matta collapses

The discount perfume chain Perfume Empire has been placed in the hands of receivers, just six months after its owners, Richard and Christine Matta, appeared on the BRW Young Rich list with a fortune of $58 million.

The chain, which has 34 stores around Australia, with the majority in New South Wales, was placed in the hands of administrator Giles Woodgate of accounting firm Woodgate & Co on March 28.

However, Woodgate told SmartCompany that receiver Quentin Olde of insolvency firm Taylor Woodings was appointed to the business last night and is now in control.

The chain remained open for business yesterday and was still trading this morning.

Although Olde told SmartCompany this morning that he could not guarantee the business would continue to trade in the short-term.

“It really depends on what we find in terms of the financial position of the business.”

Olde, who will now act for secured creditor Westpac Bank, says the appointment of administrators was unexpected.

“The appointment has come as a bit of a surprise to the bank so obviously our role is assessing what is going on and what has happened.”

He would not comment on the amount of money owed to Westpac.

Richard and Christina Matta were unavailable for comment prior to publication.

The pair started Perfume Empire in 2003, a year after the pair started their first pharmacy business.

Sales at the perfume counter were poor and Richard brought in his wife Christina, who had experience in retail and fashion, to try and turn things around.

Christina designed a new format for the counter, created a separate brand and launched a store-within-a-store format. As well as the new brand, the attraction was big-named perfume brands imported form overseas and sold at discounts of up to 80%.

Exactly what has gone wrong at Perfume Empire remains unclear, although ASIC records show the company was hit with a winding up application in February.

The difficult retail environment combined with razor thin margins that are typical of discount perfume businesses may have also contributed to the collapse.

Richard Matta told BRW last year that the rapid growth of the business had moderated in 2010 to around 5-8%.

In 2010, the Mattas rebranded their five Terry White pharmacies under a new brand called Chemist Depot and acquired another four stores. Richard told BRW there were plans to add another 20 Chemist Depot franchises over the next 12 months.

ASIC records show the Chemist Depot is not in administration or receivership.