The Wine Society has gone into administration owing $1.45million to unsecured creditors.
Membership of the 74-year-old co-op had slumped from 100,000 to 20,000 in recent years.
The society’s administrator Giles Woodgate, at Woodgate & Co, told The Daily Telegraph that not enough effort had gone into maintaining and growing its membership base.
Geoff Goodworth – a Wine Society director for 20 years, added that marketing mistakes had been made, including an expensive foray into brewing.
The Wine Collective took over the Society’s day-to-day operations three years ago. At the time it owed $4.3million to suppliers after struggling to compete with discount bottle shops and rival online retailers.
CEO Lloyd Heinrich (above) said The Wine Collective had done its best to attract new members to the co-op.
“We spent a huge amount of money trying,” he said. “It became increasingly clear that getting people to join this old Society was not going to be possible.”
The final nail in the coffin came when no members nominated to join the board prior to last November’s annual meeting. With the current directors wanting to retire, an administrator had to be called in.
In addition to the $1.45 million owed to 125 trade creditors – which include Tyrrells, Casella and Oatley – the Society has $300,000 in unsecured borrowings.
Woodgate said he had three assets to sell: the Society’s shareholding in the collective, its distribution list and the ongoing right to royalties from member sales.
