Family-owned bakery Aulds has placed its retail business into liquidation to focus on its wholesale and production operation.
The move is designed to turn around the company, which reported a loss of £430,000 on turnover of £15.4m in the year to 1 April 2017.
The retail business has been forced into an “unsustainable loss-making position” by a combination of pressure from high street and supermarket competition, as well as increasing ingredient, distribution and wage costs, according to the liquidators.
All 26 Thomas Auld & Sons stores across Scotland will continue to trade while joint liquidators Paul Dounis and Steve Ross of RSM Restructuring Advisory consult with around 180 Aulds’ retail staff and assess the retail division with a view to selling all or some of the stores as a going concern.
Aulds products will countinue to be available in independent outlets and 50 Scotmid stores supplied by the business, and this will not be impacted by the liquidation of the retail division.
Aulds managing director Alan Marr, a fourth-generation descendent of founder Thomas Auld, said the retail liquidation was the only way to protect the rest of the business, which employs a further 200 people.
He explained that the move would ensure the survival of the brand and safeguard 200 jobs across its two other subsidiaries:
- Aulds Bakeries Limited, which manufactures fresh and frozen bakery products, including World Pie Champion Special Pie and Aulds fudge doughnut on a site in Greenock;
- Aulds Delicious Desserts, which has a manufacturing facility at Inchinnan, supplying the foodservice market with premium desserts, and has grown 8% annually over the past three years.
“We have invested considerable time and effort over a period of several months looking at alternative courses of action which would allow us to avoid the voluntary insolvency of our retail business,” he said. “Unfortunately, the losses in our retail business are such that the rest of the group is no longer able to sustain it.
“We sincerely regret that a significant number of our colleagues will be affected by these circumstances, and we’ll be working closely with local job centres and other services to help people into new jobs if necessary.”
Marr added that the business passionately believed in its products and was committed to a successful future.
Founded in 1900 by Thomas Auld, the company was taken over and led by Thomas’ nephew, Ian Marr, in the 1950s. The fourth generation of the Auld family joined the business in the 1980s, with Ian’s children, Fiona and Alan, joining their father. Alan became managing director in 1991.