Shock and sadness as popular cafe chain Wishbone placed in liquidation

Popular cafe chain Wishbone has been placed in liquidation. Photo / Dean Purcell

There’s surprise and sadness in the capital city after the abrupt closure of a well-known and popular cafe chain.

Wishbone was placed in liquidation on Monday.

The cafe’s website is no longer working and a liquidator has been appointed to The Woodward Group, a holding company used to trade the business.

Mohammed Jan of insolvency firm Liquidation Management was appointed yesterday by a special resolution of shareholders, according to the Companies Office website.

In a statement this evening, Jan said the business has been trying very hard to continue in the aftermath of Covid-19, “but has struggled with rising food costs, increased wage costs, and slower sales, all due to an extremely tough post-Covid economic climate”.

“The company was unable to sustain any more losses, including substantial further investments by the directors into the business to keep it going.”

Wishbone’s factory and all retail stores have ceased operations, except the cafe at Wellington Hospital.

The liquidator is liaising with interested parties who have shown interest in purchasing the factory and stores, Jan said.

Unite Union national secretary John Crocker said the sudden shutdown came out of the blue.

“I’m surprised by this. They’re a national chain, they’re recognisable, you know the brand,” Crocker said.

“It’s unusual to have something happen this abruptly. You’d normally see something contract before it falls over.”

Wishbone operated about 20 branded outlets around the country, and traded in both major supermarket chains while supplying various trade customers.

It employed around 110 staff spread between retail outlets, manufacturing facility and HQ.

Crocker said the union had received no indication the business was in trouble, and staff would be walking away with little compensation.

“The staff are owed certain things as preferred creditors - they’re owed any wages up to the point of termination. They’re owed any contractual notice period, they’re owed their holiday pay. And if there’s any redundancy compensation in their contract then they’re owed that as well.

“I would be very surprised if there was any redundancy compensation in a Wishbone employment agreement, though.”

Wishbone founders Andrea Gibson Scarlett and Shayne Scarlett.

Crocker said redundancy payouts were rare in hospitality and retail.

“It’s part of the reason there’s issues with staff in hospitality these days. Workers were made redundant during Covid, they were thrown out without any compensation, and they’re a little burned by that. They’re not flooding back to the industry.”

Two months out from an election, it was a timely reminder for the Government to consider what happens to workers in situations like this, Crocker said.

“We advocate for statutory redundancy compensation. I know the Government was talking about income insurance, which was shelved, but workers need something. Pick one - workers need it.”

Wishbone was the brainchild of Wellington entrepreneurs Andrea Gibson Scarlett and husband Shayne Scarlett.

They started the business in 1999 and expanded into Auckland in 2004. Wishbone was ranked No 35 in the Deloitte Fast 50 list of companies in 2003.

A call to Wishbone head office reception went unanswered this morning.

A Victoria University spokeswoman confirmed the Wishbone cafe at the Kelburn campus stopped trading yesterday.

“The university community is very sad to see Wishbone close,” she said. “We have enjoyed a very good relationship with the team over the years and they have always provided great food and service to our staff and students.

“It has been an important and valued part of the Kelburn campus. A range of other cafe outlets are still available on the Kelburn campus.”

The Wellington City Council was given no advance warning about the Wishbone outlet at Ākau Tangi Sports Centre closing yesterday, spokesman Richard MacLean said.

The council has been left to advise people of the closure.

Wellington Airport has also confirmed its Wishbone store stopped trading on Tuesday.

The Wishbone Cafe at Wellington Regional Hospital has remained open.

But Te Whatu Ora Capital Coast & Hutt Valley facilities and business services acting director Roger Palairet said the hospital was advised late on Wednesday afternoon it may no longer be open tomorrow.

“While this differs from our initial understanding with the liquidator of the company that operates Wishbone, we respect their right to make this decision,” Palairet said.

“We are yet to receive confirmation of the liquidator’s plans around timing and vacating the premises, so we are not able to provide any further detail at this time.”

Palairet said it was likely the hospital would have to find a new cafe provider for the space Wishbone currently occupies.

“Staff, patients, and visitors at Wellington Regional Hospital are still able to purchase delicious healthy food and beverages from our other onsite vendors Mojo, Te Rourou - The Health Deli, and the White Cedar Café at Te Wao Nui children’s hospital.

“We value the quality service that Wishbone employees have provided to our staff, patients, and visitors and we are sorry that the company has gone into liquidation.

Katrina Bennett is Wellington’s head of news. She has worked for NZME in the capital for 15 years, starting out as a broadcast journalist and then breakfast newsreader.

Georgina Campbell is a Wellington-based reporter who has a particular interest in local government, transport and seismic issues. She joined the Herald in 2019 after working as a broadcast journalist.