disclaimer: Kiva Logic has no relationship with Aussie Farmers Direct, this is just a summary of information freely available on the internet. This is not a complete picture of what happened and why, just some notes and interesting quotes we’ve found
Update March 7, 2018 - more stories from franchisees coming in: #march-7-2018, no solution in sight
IF YOU ARE A FORMER Aussie Farmers Direct Franchisee- CONTACT US if you are thinking about starting your own local home delivery service. We will help you with the back-end operations, front-end customer website and more. If you already have a van, then you only need a supplier and customers. We can help with the online operations systems. Contact us on our contact form or send a direct email to email@example.com or firstname.lastname@example.org.
Ok, so AFD closed?
Aussie Farmers Direct announced it was immediately closing and ceasing all operations on March 5, 2018. Aussie Farmers Direct was one of the largest home delivery services in Australia, based out of Melbourne.
AFD did AMAZING work bringing together consumers and local farmers, vendors and artisans in the first half of their existence, and they deserve major props for that. But something changed.
The sudden closure marks the second large-scale immediate shutdown we’ve seen in the past 4 months. The first was here in the USA right before Thanksgiving, and the story is eerily similar.
These sudden shutdowns by companies that largely support small local farmers and vendors are devastating. Not only are employees out of a job, but vendors and farmers who were able to rely on selling their product to Aussie Farmers Direct no longer have that sales channel. Companies hyper-focused solely on growth can destroy local food economies- from franchisees to vendors to customers, no one wins.
This post serves as a summary and timeline of how Aussie Farmers Direct reached this point so we can try to figure out what happened. We have a lot of holes in the early years, but we’re still working on it. If you have any articles, send them to email@example.com
Timeline, what happened?
2005 - Launched with small milk run in Victoria, founded by marketing professionals William Scott and Jordan Muir in 2005 (smh.com.au)
2010 - name BRW’s fastest-growing franchise (abc.net)
2014 - Company ran at $12 million loss (smh.com.au)
2014 - Founder Jordan Muir leaves company (smh.com.au)
2015 - Founder William Scott leaves company (smh.com.au)
2015 - Company losing more than $1 million month (smh.com.au)
2015 - Customer data hacked (smh.com.au)
2016 - AFD Rolls out new branding (powerretail.com.au)
2016 - Expands to full supermarket offering (smh.com.au)
2018 - Closed and appointed voluntary administrators
November 6, 2015
Aussie Farmers Direct customers’ data hacked
- 5000 customer account data posted online
- $100k ransom demanded (and not paid)
- “The Australian Federal Police said they were contacted by Aussie Farmers Direct about the breach but are not investigating, instead advising them to update their virus protection.”
August 15, 2016
- Expands to full supermarket offering
- Claimed to price-match supermarkets or beat them with specials
- Mr Louie said company had about 100,000 regular customers with the potential to double or triple it’s sales over next 12 months
March 5, 2018 - Immediate shutdown announced
Why Aussie Farmers Direct couldn’t compete with Coles and Woolworths
- “Agronomy expert Dr Daniel Tan of the University of Sydney said Australian grocery shoppers should be concerned.”
- “Dr Tan said he believed it was a bad move for Farmers Direct to expand outside of its original core business – a niche home delivery service for fresh produce from farmers.”
- “Dr Louise Grimmer agreed that consumers should be worried when smaller operators offering alternatives to the ‘big two’ are pushed from the market.”
Home delivery group Aussie Farmers Direct closes
- appointed KordaMentha as administrator on Monday
Aussie Farmers Direct goes into administration affecting 100,000 customers, truckloads of produce turned away
- 100,000 customers affected, 100 franchisees
- Farmer suppliers unaware of the business closing until this morning
- “The bigger they get the more challenging the logistics became.” - Food and agribusiness consultant Mark Soccio
Aussie Farmers Direct goes into administration, KordaMentha appointed
- Craig Shepard and Leanne Chesser of KordaMentha as voluntary administrators
- KordaMentha will seek buyers for Aussie Farmers’ assets, including its database of about 100,000 customers
Aussie Farmers Direct falls into administration, to close immediately
- “The collapse leaves 260 employees out of work and some of the almost 100 franchisees who bought into the business facing financial stress after spending large sums of money buying specialised delivery trucks.”
- Company losing more than $1 million/month in 2015
- A rescue plan for the group is looking unlikely as much of the company’s debt is held by investors.
- Red Gem Potatoes in Nar Nar Goon sold to AFD, will be losing 5-10% of their business
- Anonymous franchisee was left with $250,000 debt from loans taken out for rights to two delivery areas and two refrigerated vans
March 6, 2018
Aussie Farmers Direct Closes 12 Years Business
- $80 million in lost profits from shutdown reported 1
- 100,000 Australians stranded who relied on delivery 
- 260 employees left jobless with no notification 
- Trucks containing produce and groceries turned away from warehouse  http://www.dailymail.co.uk/news/article-5465863/Aussie-Farmers-Direct-closes-12-years-business.html
“Let down from the start”: Aussie Farmers Direct franchisee speaks out after spending $130,000 to buy grocery franchises
- Franchisee spent $90,000 in 2013
- Purchased additional three areas for $40,000
- no big swells of new customers coming on board
- number of customers same as first year, even with additional 4 areas
- had offer to sell his franchise for $70k… until yesterday
- Frachisees’ reportdly owed four weeks pay
- “This business should have never been franchised, that’s the biggest regret. It’s a real disappointment to me..”
March 7, 2018
“It’s unsustainable”: Grocery startups offer to help Aussie Farmers Direct franchisees, but supermarket price war remains the big challenge
- grocery startups reaching out to try to help franchisees
- FarmGate Online “in conversations” with Aussie Farmers Franchisees, but best way to help “bigger conversation”
- YourGrocer thinking about teaming up to partner with drivers
“Franchisees of failed company Aussie Farmers Direct say they have lost everything”
- destroyed. One franchisee couple lost more than $125,000
- “Mrs Roberts said it was a mistake for the company to try to provide general groceries on top of milk and fresh produce.”
- “Trucks of fresh produce were turned away on Monday and Mr Skene said farmers were frantically trying to find somewhere for their produce to go. “
- “Franchise owner, Geoff Roberts said he had not ruled out a class action.”
Other shutdown articles:
We’re not saying these articles are better or worse, we just didn’t learn anything new to include in this blog post.
(we stopped adding links after this because there are so many articles)
Android app is still listed on Google play as of March 6, 2018. Apparently the app was not popular:
Text from home page
“We love you, goodbye.
From the team at Aussie Farmers Direct, thankyou for your support, we love you all, and we are so sorry to be going away.
Eat well, love your family, look after your friends. Remember that dreams are fragile, and we all need each other.
We are sad to announce that Aussie Farmers Direct is closing its operations today.
After 13 years of working with many of Australia’s great farmers and delivering their fresh produce to Australian families, it is hugely disappointing that is has come to this. We are simply no longer able to compete against the domination of the major two supermarkets and the influx of cheap imported produce.
Aussie Farmers Direct started as one small milk run delivering 100 bottles a week. Over the years we grew to be a full-service grocer to thousands of customers across Australia. We have worked with hundreds of farmers and local suppliers over the years, and we are proud to have played our part in getting farmers and Australian households a fair deal. With the support of our customers, we took a stand on many industry issues including fair milk prices, free range eggs and supporting farming communities through the tough times including droughts, floods and financial hardship. We have also enjoyed celebrating our Australian farmers commitment to quality, hard work and resilience.
Unfortunately, we will be unable to deliver any future orders to our wonderful customers. No one will be charged for these orders. Any customer who was scheduled to have a delivery on the afternoon of Monday 5th March and has been charged for this order will have their order refunded shortly.
We would like to thank all our loyal customers, farmers, suppliers, franchisees, and staff for their support over the past 13 years.
Note for suppliers:
Any creditors of the business that believe they may have a claim to be made against the company should forward any such claim to firstname.lastname@example.org as soon as possible to ensure this debt has been registered with the Administrator.”