“I don’t want to give up on my team, my friends and my community. I want to be that person who says yes, we are going through the fire, but be the phoenix and come back and learn from these mistakes.
“The biggest thing I’ve learnt is to keep going, despite the feelings, despite the liquidation banner over your head, despite the negativity it can cause.”
Gemmell said mounting pressure from Covid, flooding and debt “broke” his dream, but the message he wanted to send other business owners and his community was one of positivity and resilience.
The Insolvency and Trustee Service, the Official Assignee’s Office under the Ministry of Business, Innovation and Employment (MBIE), was appointed as liquidator. Liquidator James Grover-Grey released his initial report this week.
The summary of claims in the report gives an estimated claims figure so far of $408,000.
The IRD claimed almost $407,000 as a preferential creditor and $1800 in applicant creditor costs and disbursements.
Layton Gemmell told the Gisborne Herald that about 80% of the amount owed to IRD was penalties and interest.
“We tried to work out a payment plan with them, and we did. We tried to keep paying them back at $2500 a week, and it just got unbearable. We tried that for about six months. We sold a lot of company assets to pay down that debt as well.”
A list of known and potential creditors in the report includes Flexicommercial, Ricoh Finance, Bidfood NZ, Silver Chef Rentals and Coca-Cola Amatil.
Known and potential unsecured creditors in the report are Mercury, One NZ, Alsco and BNZ.
Development of Ahi Kōmau – Gemmells on Parade, on the site of the 2012 Gemmells building fire, was completed in 2023.
The Gemmells restaurant was announced by building owner Wairoa District Council as the first tenant of the development a year earlier.
Gemmell said disruption from the Covid pandemic and lockdowns, along with the impact of Cyclone Gabrielle on Wairoa, were the main reasons for liquidation.
“What really broke us was just isolation here in Wairoa, cut off, Gabrielle and Covid and paying back all of these things.
“We lost probably about $50,000 worth of equipment in the flood down by the river in a storage location there, [we were] doing school lunches for the Government. Six hundred lunches a day and all our hāngi cookers, savouries, serving dishes and everything got washed away in the flood,
“When we claimed insurance, our insurance company said your insurance was for a fixed location, but because you deliver school lunches, we [classified] you as mobile, and so we lost out on that.”
He said the company received $7000 in support from the Hawke’s Bay Chamber of Commerce, but it wasn’t enough to cover the loss at the time.
“We had a food trailer, which we continued to operate post-Gabrielle, offering free burgers to the community to pay it forward, and we got this location we are in now.
“It just got too unbearable. We tried to pay IRD, we tried to pay our suppliers and everything,
“The best option was to just go with liquidation. I feel sickened doing it because I feel sorry for my suppliers.
“I want to work with them now, I want to go through that process, so that is my focus at this stage.”
He said he knew others might be going through liquidation, and he wanted them to know it was “not the end of the world” and to offer his support.
“We hate going through it, we hate what it does with the outcome, but the best thing we can do is keep a positive mindset, carry on and learn from it and do better and look after things better, but keep going and keep moving forward in whatever it is we are going to be doing.”
He said he would stand by and support anyone going through a similar process if they came to him.
“I look forward to that day when I can be that source of inspiration and support and help to others who may be feeling the same way or may be feeling worse.”
Grover-Grey wrote in the report that liquidation was expected to be complete in the next six to 12 months.
Nationwide, the number of companies put into liquidation surpassed last year’s total for the same period in October, with 1974 from January 1 to September 30, compared with 1846 last year.
Kare Johnstone, McGrathNicol partner and chairwoman of the Restructuring Insolvency & Turnaround Association of New Zealand, speaking with the NZ Herald, attributed the recent rise to an increased focus on enforcement by IRD and a lag of companies in distress during Covid that were partially saved by Government support.