Puzzle Coffee, a Melbourne-based cafe chain, opts for voluntary administration

A popular coffee chain, with four locations in Melbourne, has gone into administration.

Puzzle Coffee went into voluntary administration on June 28, according to documents listed by the Australian Securities and Investments Commission (ASIC)

The café chain, which boasts cafés at Swanston St, Melbourne Central, Southern Cross Station and Chadstone Shopping Centre, said they are “working closely” with administrators to ”actively explore solutions”.

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“Similar to many small hospitality businesses in Melbourne, the past few years have brought significant challenges to our company due to the impacts of COVID-19,” a spokesperson told 7NEWS.com.au.

“Puzzle Coffee venues are operating as normal, and are fully committed to providing regular updates to all stakeholders as it works through the voluntary administration process.”

Puzzle Coffee, went into voluntary administration on June 28. Credit: Puzzle Coffee

Melbourne restaurant Calia, which has links to Puzzle Coffee, also entered administration the same day.

Jirsch Sutherland partner Glenn Crisp confirmed the practice had been appointed as the administrator of both businesses.

Co-founded by Jason Chang and Ricky Thien, Calia has two physical restaurant stores at Chadstone and the Emporium, with both accompanied by a retail section offering high-quality food and alcohol products.

The products are also available through Cali’s online marketplace.

The same week the company collapsed, Chang, who is also a City of Melbourne councillor, took to social media to share the struggles he had faced as a business owner amid the cost-of-living crisis.

“I recently broke down in city council when I commented on the challenges of small businesses in Melbourne CBD as well as families during this cost-of-living crisis,” he wrote.

“I have now realised that as strong as I try to be, I am not immune from depression and anxiety.

“Like many other struggling small business owners in Melbourne, my own hospitality businesses have been faced with many financial challenges with the rise of operational costs (wages, COGS (cost of goods sold), rent, borrowing costs, etc).”

A spokesperson from Jirsch Sutherland said both of Cali’s Melbourne restaurants had been “severely impacted” by COVID lockdowns.

“Trading has improved since then; however, it’s not sufficient to clear the backlog of debt,” the spokesperson said.

“The business is continuing to trade with the purpose of restructuring and entering into a Deed of Company Arrangement (DOCA) with its creditors.

“If this is accepted by creditors, the business will be restructured and continue on.”

Both businesses are expected to remain open during the administrative process.

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