Liquidators have been appointed to Ghermez Cupcakes and one of the business’ Sydney stores was closed last week, but owner and founder Ghazaleh Lyari says the business has not gone under and will continue to trade.
The former Wall Street investment banker founded Ghermez Cupcakes in 2008 and at the time described the business as “recession-proof”.
Ghermez Cupcakes expanded to four stores and attracted a lot of publicity, with Lyari featuring on Kochie’s Business Builders and the ABC.
However, there are signs of trouble for Lyari’s cupcake empire, with Ghermez Cupcake’s Chatswood store closing and Bradd Morelli and Andrew Spring of Jirsch Sutherland appointed as liquidators of Ghermez.
The liquidators have given notice of a meeting of creditors to be held next week but Lyari told SmartCompany that Ghermez Cupcakes will continue to trade.
“My business is not going into administration. It was structured as a family trust and I am bringing investors on board so the trust is being liquidated,” she says.
Lyari says the Ghermez Cupcakes stores will remain trading with the exception of the Chatswood store.
“We shut down the Chatswood store last week as it was non-performing store, but it has nothing to do with the business structure,” she says.
“I had to make a pragmatic decision on that and not let the bleeding in one store affect the others.”
Lyari says she does not have any investors secured at this stage but claims she has a meeting with a syndicate of investors who are at the due diligence stage.
“Three stores are still operating and we are looking to bring on more capital growth to continue operating in a healthy way,” she says.
Lyari refused to disclose how the remaining stores were performing financially although says a plan to open stores in Victoria and Queensland has been revised.
“Our strategy is somewhat different to last year, but we are not slowing down,” she says.
SmartCompany contacted the liquidators Jirsch Sutherland, but no reply was received prior to publication.