Red Rooster Shuts Up Shops Overnight After Owner Put Into Voluntary Administration
Several Queensland Red Rooster stores have closed suddenly, putting 100 workers out of a job, but the chicken chain is adamant it will quickly bounce back and have the fryers cooking again soon.
Seven Red Rooster stores were shut on Tuesday morning after the owner went into voluntary administration this week.
The chicken chain has taken a big hit on the Sunshine Coast and Moreton Bay as a result.
Store closures include Buderim, Currimundi, Sunshine Plaza, Noosa Civic Centre. Noosa Mary St, Deception Bay and Burpengary.
"These closures have immediately impacted over 100 employees, landlords and suppliers. As soon as we were notified of the closures we commenced working with the administrator and landlords with the aim of re-opening these stores," a spokesperson told 10 daily.
10 daily contacted the affected store's franchisee Sunstate Foods, however, the business' voicemail confirmed it is no longer operational.
It referred inquiries to administrators who are managing the insolvency.
This marks the 12th Red Rooster to shut down this year, although the reasons for each store closure are varied and include voluntary administration, end of leases and one transfer to Oporto. In this period, four new stores have also opened.
The most recent closures are the latest blow for the food chain after several franchisees made formal complaints to a 2018 Senate inquiry into the franchise food business about its business model.
Red Rooster first began as a single chicken shop in Western Australia in 1972, it reached peak popularity in the 1990s and in 2010, changed company-owned stores to franchises.
In July Red Rooster, Oporto and Chicken Treat owner Archer Capital cashed out of the franchise sector and sold the fast-food brands in a deal believed to be valued at half-a-billion dollars.
Red Rooster now is owned by Craveable Brands which also owns Oporto and Chicken Treat. The company describes itself as "the largest Australian owned quick-service restaurant operator."
Last year, Franchisee Association of Craveable made a series of complaints to the Senate's inquiry into the Franchising Code of Conduct. The submissions told during the inquiry claimed that many franchisees struggled due to the high cost of goods for Red Rooster franchisees, which they claimed was "significantly higher" than competitors and directly impacted store profitability.
Craveable Brands is adamant the Red Rooster network is strong, particularly in Queensland. The company hopes to reopen stores within a week.
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