Background
*Pharmawell Limited was a pharmacy that operated in the heart of Auckland CBD on Queen St. The Pharmacy sold over the counter medicines and on the shelf products but also had an emphasis on tourist goods/souvenirs.
*Pharmawell was hit significantly by the first COVID-19 lockdown. The board of the company took in all things to consideration (difficulties with landlord and uncertainty of future lockdowns) and decided to voluntarily liquidate the company in July 2020.
Our Appointment
Once we were appointed, we needed to work out the best way to sell all assets for the benefit of creditors. We managed to trade down the stock significantly in the small amount of time we were allowed to still occupy the shop premises. The liquidator also managed to sell small portions of stock bundles to neighboring competing pharmacies within the CBD. It is estimated the Liquidator was able to deal with 60% of the stock whilst still onsite. The remaining 40% of the stock was packed up and moved to Waterstone’s warehouse on the North Shore.
Next Steps
The remaining stock was hard to sell. It was listed a bulk lot, but no reasonable offers were made to buy. There were thousands of product items.
The liquidator, looking to maximise recovery for the creditors decided that there was more value in selling items individually and on sale than as a bulk lot and so we set up the stock as a pop-up store operated it from our North Shore warehouse.
The liquidator temporarily employed a shopkeeper and ran an effective marketing campaign to promote the pop-up sale. Although seemingly old fashioned, we ran a flyer/poster campaign in the local area and posted on various community pages.
This proved to be more lucrative than anticipated. Over the three-week period spanning from late November to mid-December the liquidator generated over $35,000 of sales. This option was proved to be far better than selling to wholesaler’s who were offering only $4-$5K for the same amount of stock.
Result
The pop-up sale was an extremely effective way to sell the remaining stock of the pharmacy and the sales ensured that all staff members were paid their outstanding holiday and pay entitlements.
To our knowledge, Waterstone is the only insolvency firm that has its own warehouse which enabled us to run this pop-up store and secure the result for staff.
*Name changed
