End of an era as Bakos Brothers closes its doors
Popular premium furniture retailer and manufacturer Bakos Brothers is no more.
The 47-year-old luxury furniture maker is winding down after going through an unsuccessful business rescue process for eight months.
The company, which boasted stores in Kramerville, Dunkeld, Menlyn, Nelspruit and Cape Town and a 12,000 sqm factory in Wynberg, Johannesburg, has already retrenched 144 people.
This was confirmed by George Rautenbach, a business rescue practitioner, who came in on May 2 2019 in an attempt to resuscitate the ailing business.
He attributed the company closure to the tight trading environment.
"The overriding reason [for the collapse of the business] is the distressed retail economy and lack of disposable income flowing towards retailers," said Rautenbach.
"Just like the car industry and everything in the top end are struggling and have experienced a dramatic drop in turnover over the past two years."
He said the Bakos Brothers creditors gave him a go-ahead to liquidate the business if there was no hope in saving it.
"There are creditors who are owed by the business. On August 7 last year, we published a business rescue plan and it was adopted by 92% of the creditors, and they gave us a mandate to try to save the business," said Rautenbach during an interview with SowetanLIVE.
"From May to December we paid our suppliers cash on delivery and we were able to complete all client orders and we traded successfully during business rescue but unfortunately we had to supplement the cashflow by selling goods at significantly lower prices, which meant that there was less cashflow and the model was unsustainable," he said.
Rautenbach said as part of the liquidation process all goods owned by the Bakos Brothers furniture retail and manufacturing business would be sold on auction next week Saturday to raise cash to pay the company's creditors.
At the auction, scheduled to start at 10am, the entire manufacturing facility, trucks, Bakos Brothers luxury furniture, equipment that manufactures furniture, raw materials like leather works and imported wood would be sold off.
He said Bakos Brothers used to manufacture its own sofas and did its own woodwork while its competitors prefer to use cheap Chinese imports.
"The business ended up not reaching its break-even point for many months. And if you don't achive your break-even point month after month that will result in the business not being sustainable," said Rautenbach.
Rautenbach, who is the same age as Bakos Brothers, was, however, sad to be the man responsible for closing down the business.
"Over the last two years the Bakos family have invested a significant amount of money in order to assist the busines during the difficult retail times," he said.
"They invested a lot of money into creating a manufacturing capability as they believed that the country should have its own manufacturing skills. It is sad that as SA we are going to lose the skills that Bakos Brothers had in running the business."
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