DARBY’S Fresh Bake and its 27 Hunter and Central Coast stores are under a cloud after its husband-and-wife owners called in the insolvency experts and put the business into voluntary administration.
Administrator Brad Morelli is hoping to keep the shops open and preserve the jobs of more than 100 employees while he works to sell or restructure the business, which he confirmed had debts of more than $1 million, with the tax office a major creditor.
It’s the second time around for 70-year-old Victor de Vries and his wife, Helen, after they called in the administrators in 2001, soon after taking over the business that began with a single shop on Darby Street, Newcastle, in 1969.
Mr de Vries said it took a seven-year deed of company arrangement back then to pay all his creditors, but they “received 100 cents in the dollar” of what was owed to them, and the business then kicked on and expanded until its recent troubles.
Mr de Vries blamed two warm winters and the rise of online shopping leading to fewer customers in the big regional shopping centres, where many of Darby’s stores are located.
“If I had 20 Darby Streets it would be all right,” Mr de Vries quipped, saying that trading was stronger at stores such as Darby Street at stand-alone addresses.
Mr de Vries said he had no choice but to call for insolvency help, and Mr Morelli and Trent Devine from the Newcastle office of Jirsch Sutherland were appointed on March 26.
Mr Morelli said a first creditors’ meeting was held last week, and while the financial state of the company – DFB Trading Pty Ltd – was yet to be finalised, he was confident there was enough money to cover employee entitlements.
“Darby’s is a Newcastle institution and we are working with the owners to continue trading and preserve the business and more than 100 local jobs while we seek expressions of interest for a sale of the business or a potential restructure,” Mr Morelli said.
“I would encourage everyone who’s enjoyed a Darby’s pie or cake to support this local icon and go out and buy a feed from their local Darby’s store.”
Working at the Gateshead factory on Friday, Mr de Vries said the company still tried to produce its products as cheaply as possible but pies were now $3.50 and the days of Darby’s famously selling everything at $1 were “long gone”. He said Darby’s suppliers were still working with it, allowing it to keep baking and to trade on.
“I want to trade my way out or find a buyer,” Mr de Vries said. “There are 100 people relying on us for their living. This is not something we are taking lightly.”