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Home / The Country

Tauranga Mad Butcher explains heartbreaking decision to call it quits

Bay of Plenty Times
27 Oct, 2016 08:00 PM4 mins to read

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Twelve years of hard work seven days a week has ended for the Tauranga Mad Butcher franchisees who have called it quits after years of "tough trading".

Twelve years of hard work seven days a week has ended for the Tauranga Mad Butcher franchisees who have called it quits after years of "tough trading".

Ironically, yesterday was one of Wayne and Nita Kelsall's best days of trading, closing their doors for the final time to empty shelves and fridges.

One of the last customers through the doors was loyal customer Keith Baker, who has shopped at the Mad Butcher since it opened.

The elderly Mr Baker told the Bay of Plenty Times mid-afternoon as he manoeuvred his mobility scooter into the store for a final farewell that he and his wife had bought all their meat and bread at the Mad Butcher.

"Wayne's been a great neighbour," he said. "It's a very sad day."

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Mr Baker was one of the last of what had been a steady stream of shoppers on what Mr Kelsall described - ironically, gesturing at the empty meat fridges - as "one of our best day's trading".

Every single comment from customers had been positive and encouraging, he said.

The decision to liquidate had been caused by a combination of rising meat prices, aggressive pricing competition from supermarkets, and, in his view, the negative fallout relating to the closures of other Mad Butcher franchises around the country.

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"It was a good business for the first nine years or so," he said.

"But the last three to four years have been tough trading. The meat industry generally has been going downhill."

People were eating less red meat, and pricing was difficult because New Zealand consumers were essentially paying export prices. But the major factor was the competition from supermarkets, he said.

"They are way more aggressive than they ever used to be. Every special we've run for months has been bettered or matched on price."

... I can't keep living in hope that in three weeks or four weeks, or two months it will pick up ...

Wayne Kelsall

That meant there was even less reason for people to exit the supermarket to buy their meat at a smaller, specialist butcher. Tauranga Mad Butcher was situated near a Countdown and a Pak'nSave, while recent months have also seen the opening of a second Pak'nSave in Tauriko and a SuperValue in Pyes Pa, which had fragmented the market even further.

"It got to a point where it was just too tough," Mr Kelsall said.

"And you just say, I can't keep living in hope that in three weeks or four weeks, or two months it will pick up and we might regain some of [those losses]."

Tauranga Mad Butcher appointed Tauranga BDO as liquidators on Monday.

The liquidators were still discussing options with a number of parties, some looking at keeping the store as a Mad Butcher outlet and others wanting the premises, which were leased by the franchisee. There were 14 full-time and part-time staff affected by the closure.

Read more: Months of poor trading forces Tauranga Mad Butcher into liquidation

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Mr Kelsall and his wife bought into the franchise when it was controlled by founder Peter Leitch, the original "mad butcher" whose personality was seen as a key factor in the brand's success. Mr Leitch sold out to Michael Morton in 2007, who in turn sold to Veritas Investments in a $40 million cash and share deal in 2012.

At least 10 Mad Butcher stores have gone into liquidation since 2012, including the original Mad Butcher store in Mangere, which opened in 1971 and closed in July this year, owing hundreds of thousands of dollars.

Asked about future plans, Mr Kelsall laughed.

"We've worked seven days a week for the last umpteen years without a break," he said.

"The first thing on the agenda is to have a breather and let the dust on this settle."

Veritas Investments chairman Tim Cook said he did not agree the closure of other Mad Butcher franchises would have had an impact on the Tauranga outlet's closure.

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"A store closing in Silverdale wouldn't impact the store in Tauranga," he said.

The aggressive nature of supermarkets, who were fighting each other was more likely the majority of the issue.

"To a certain degree small independent operators are getting caught in the crossfire with aggressive pricing," Mr Cook said.

He had not yet spoken to the liquidators.

Veritas Investments

Owns the Mad Butcher franchise, Nosh and Better Bar Company

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NZX-listed company

Posted an audited net loss of $4.59 million in the year to the end of June 2016, compared to a profit of $3.33 million a year earlier.

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