Luxury Devon ice cream producer saved from closure

Devon-based luxury ice cream business Granny Gothards has been saved from closure after a foreign investor stepped in - meaning jobs and suppliers were protected and it is now set for rapid growth. The award-winning Willand-based manufacturer was badly affected by the Covid lockdowns, mounting inflation and even recent bird flu outbreaks.

When its bank called in its overdraft the business teetered on the edge of closure, but an international white knight appeared and was prepared to invest. However, business founder Amanda Ringelberg said the deal was contingent on a restructuring which meant her firm Granny Gothards Ltd being liquidated.

It left debts of £531,086 unpaid but £210,685 of this is cash she put into the company herself, and more than £218,000 is from bank borrowings. Amanda stressed almost all trade creditors were paid and by saving the business it secured jobs of 10 permanent employees, and seasonal workers, and supported suppliers and customers.

The ice cream company is now run under Granny Gothards International Ltd, controlled by UAE-based Waza Holdings Ltd. The business is now set to grow again with export opportunities and contracts with the likes of Warner Bros, Eurotunnel and Dubai-based Grandiose Supermarket.

“The easy option would have been to close the doors and walk away,” Amanda told DevonLive. “But my priority was the staff that work here, to protect their jobs, and our customers in the UK and overseas.”

She said liquidating the company incorporated in 2011 had been “a very difficult decision and not taken lightly” and said it meant “ many nights of no sleep and many hours of difficult decisions”. But she stressed that in order to grow the international investor had to come on board.”

Set up in 2006, Granny Gothards has sold its artisan ice cream and sorbets across the UK and abroad, now producing 195 flavours, including for top chefs and high-end restaurants. Its products have won more than 20 awards, including from Food Drink Devon and Taste of the West, and was highly commended by the Great British Food Awards.

But despite this success, Granny Gothards received a body blow when Covid lockdowns curtailed its sales routes. Amanda said: “During Covid, like everyone else, we struggled as all of our customers closed their doors and left the business with a huge amount of stock that had been prepared in readiness for the start of the season.

“During 2020, we struggled like all other businesses and even took to the roads, delivering ice cream to consumers, one box at a time. It was my only aim to keep Granny Gothards going through this difficult time and to ensure the freezers stayed on and the staff got paid. I did not take any money myself during this time and in fact got myself another job working for my daughter.”

Amanda said the company took advantage of the Bounce Back Loan (BBL) scheme and used this to pay the electricity, rent and insurance bills. She said: “During this time we had an overdraft with the bank that was normal for the time of the year, one that was always cleared during our summer trading months. I am sure this is the same for a large number of seasonal businesses.

“As we were not generating any sales, we were not able to clear the overdraft and the bank were very supportive at this time and understood our situation. We were lucky to win a big export order in the fourth quarter of 2020 and this kickstarted the production although by this time the cost of everything had skyrocketed.

“Moving into 2021/2022, the rising cost of electricity, the bird flu epidemic and the increase in goods for Europe all added to the financial problems, there never seemed to be any light at the end of the tunnel. Sales were down massively in the UK due to so many of our customers closing their doors permanently, as well as a general drop in consumers going out and eating in bars and restaurants.

“This together with the extra payments for the BBL and the (Government’s) Recovery Loan scheme caused further cash-flow issues as we were heading into our busy season. Whilst these were difficult times, I made sure all staff were paid and suppliers were paid and again took no salary myself, using my savings to support my personal living expenses.”

Amanda said she was also facing personal problems at this time and action needed to be taken to prevent the closure of the company “making all staff redundant and meaning we were not supporting local suppliers with purchases”. She said: “The final blow came earlier this year when I thought we had finally weathered the storm and the bank decided to call in our overdraft. There was literally no way for the company to continue in its present form.”

She said: I was approached by a buyer who wanted to take over Granny Gothards if, and only if, the existing company was put into liquidation. Whilst I saw the benefit of the liquidation route, the buyout was not the right move for the business at that time.

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“In order to protect the staff and customers, and after many more sleepless nights and soul searching, we secured some international financing from a private investor who stated it was only prepared to invest in a new entity, so after following financial advice I took the decision to put Granny Gothards into liquidation and start a new business under the name of Granny Gothards International.

“We honoured over 95% of our trade creditors and after talking to them and explaining the situation, managed to extend payment terms to enable the payment of invoices. Although we have gone into liquidation, the only major creditors are myself, HM Revenue and Customs and the bank.

“We have managed to continue to pay staff during this difficult time and have therefore continued the employment for several local people. I cannot thank the staff enough for the support and belief they have had both for me and in me.”

Amanda said dealing with issues facing Granny Gothards had taken its toll on her and said: “It is only with the support of my daughters and their families, the staff here at Granny Gothards and my very dear friends and colleagues in the Middle East that I have managed to get through this terribly difficult time.”

But she added: “We are still here, employing local people, buying local supplies and with a positivity across the whole organisation. We are working on our business growth and continue to produce the best ice cream we can and that we are known for across the globe.”