Pie Face collapses into voluntary administration

Posted by AFN Staff Writers on 24th November 2014
Pie Face collapses into voluntary administration
Pie Face collapses into voluntary administration

Australian food franchise Pie Face has collapsed into voluntary administration.

In a media statement, the Pie Face Group confirmed Jirsch Sutherland has been appointed as administrators. However, Pie Face said it was “business as usual” as the administrators conduct a review of the Company’s operations.

Pie Face launched in Sydney in 2003 and now has 89 stores across Australia, the United States and New Zealand, with plans for expansion into the Middle East, Malaysia and Singapore. The Company offers premium handmade sweet and savoury pies, pastries, cakes, muffins, coffee and other lunch options. Products made in the Pie Face Central Kitchen are distributed to stores where they are baked fresh for customers 24 hours per day.

The Company said the move into administration came “as part of a wider company review, which will see the company focus on supporting the growth of its franchise-operated stores as well as the wholesale business”. Pie Face said the international businesses are not affected.

Pie Face’s  previous announcement of expansion moves

The last twelve months has seen Pie Face expand both in Australia and internationally. Australian Food News reported in August 2014 that Pie Face had announced it would increase its South Australian presence from July 2014 by expanding into 35 more On The Run (OTR) convenience stores across the state following a successful trial in 12 stores earlier this year.

Pie Face international growth plans

In June 2014, Australian Food News reported that Pie Face had announced it had entered into formal agreements to open a minimum 50 stores in the next 5 years in Singapore and Malaysia with VL Development Sdn. Bhd., a syndicate of experienced operators in Malaysia backed by prominent businessman, Mr. Lim Beng Hian.

In October 2013, Australian Food News reported that Pie Face had announced it was set to open 100 new stores in the Middle East after signing a major agreement with the hospitality division of Dubai-based retail and hospitality conglomerate Landmark Group.

Recent disputes and setbacks

The collapse into administration comes after Pie Face quietly closed six of its seven Company-owned stores in New York City last month. Pie Face has also previously attempted to expand into India and New Zealand, and the chain is also believed to have agreements to enter South Korea and the Philippines.

The chain also became embroiled in a legal battle with a former franchisee earlier this year.

Former franchisee Prit Dutta sued Pie Face for $800,000 in February, alleging the pie chain was misleading and deceptive when communicating the expected returns for its franchise stores.