Sara Lee Holdings, a company well known for its frozen desserts such as cheesecakes, tarts and ice cream, has been placed into voluntary administration.
Even though the future of the dessert brand is uncertain, the factory seems to be running at full capacity this morning.
Let’s see what we know and who the brand got its now famous name from.
Who owns Sara Lee Australia?
Sara Lee Australia was acquired by New Zealand private equity firm South Island Office in 2021.
Before that, it was owned by McCain Foods, a Canadian company known primarily for its frozen chips.
Are Sara Lee products made in Australia?
Yes, Sara Lee Australia desserts are made in a factory in Lisarow, New South Wales.
The company says products have been made there since 1971, more than 50 years.
Will Sara Lee close its doors?
This is something the administrators, FTI Consulting, seem to be trying to avoid.
FTI’s Vaughan Strawbridge said the company still employed around 200 people.
“We are working with Sara Lee’s management team and staff to continue our operations while securing the future of the business,” he said.
Voluntary administration does not mean the closure of a business.
What does voluntary administration mean?
It is an option for a company in financial difficulty and cannot repay its debts, explains the Fair Work Ombudsman.
This essentially means that someone outside the company – usually a consulting firm – is brought in to sort out the problem.
They review the company’s affairs and recommend whether it should:
- enter into a company constitutive document, which aims either to continue operations or to provide a better return to creditors than an immediate liquidation of the company
- enter liquidation, i.e. when the business is closed and the assets sold to pay its debts, or
- be returned to the administrators
In the case of Sara Lee, the administrator is a company called FTI Consulting.
During the COVID-19 pandemic travel bans, Virgin Australia went into voluntary administration because the airline was unable to operate flights as it normally would.
The airline has not closed its doors. Instead, it was sold, underwent major modifications, and is still operational today.
What will happen to Sara Lee?
It’s not yet clear.
“We are immediately beginning a process to sell or restructure the business and continue its long history of manufacturing in Australia,” Mr Strawbridge said.
Will Sara Lee products still be in supermarkets?
For now, probably.
Directors attempt to keep the business running while sorting out the company’s financial situation.
ABC journalist Emma Simkin visited the factory this morning.
“I can assure you it’s business as usual today,” Simkin said.
“We know this not only by the number of cars here in the parking lot – there are around 200 employees on site – but also by the smells.
“We know the bakery is indeed operating this morning.”
What will happen to the workers?
We do not know yet.
Simkin said that, for now, there was some optimism among the workers she spoke to as they headed to the plant this morning.
“They seem to be in a really good mood today,” she said.
“They hope the company will be saved, their jobs will be secure, and they will be able to continue producing the foods the Sara Lee brand is known for.”
How do consumers react?
The company has not made a public statement on social media.
But fans of the dessert brand still expressed their dismay in the comments section of its latest Facebook post.
“I’m so sad to hear the news. My family and I have been enjoying your products since we immigrated to Australia,” one user wrote.
“Sara Lee…say it’s not the case 💔😢,” another wrote.
Readers also reacted to the Sara Lee story on ABC’s Facebook page, with some suggesting the brand had lost its appeal.
“Several of their products that we have enjoyed for 10-20 years have had recipe or manufacturing changes in recent years. We didn’t like the updated products, they tasted cheaper so we stopped carrying them buy,” said one reader.
Many others, however, expressed sadness at the news.
“So sad… I bought a Sara Lee cheesecake at Coles last Monday. I loved every minute of it. It’s such a shame that people’s tastes have changed,” another reader said.
How did Sara Lee get her name?
An American baker called Charles Lubin named the company after his daughter, Sara Lee.
Mr. Lupine was an apprentice baker from the age of 14, bought three small bakeries in Chicago with his brother-in-law when he was in his 30s and went on to create an international dessert brand. according to his New York Times obituary.
The brand became well known and supplied the American Bicentennial birthday cake, which apparently weighed more than 22 tons, “talled approximately four stories tall and filled Freedom Hall in Philadelphia” in 1976, the company’s website states .
Mr. Lupine named his first product – a cream cheesecake – after his daughter Sara Lee in 1949.
The company’s website says he gave her the name when she was eight years old “because he wanted every product he made to be as beautiful and perfect as she was.”
The New York Times said Mr. Lubin sold Sara Lee Kitchens to Consolidated Foods Inc in 1956, but remained president before leaving the company in 1964.
Sara Lee products began to be manufactured in Australia in 1971.
Mr. Lubin died in 1988, at the age of 84.
Her daughter, now Sara Lee Schupf, studied business but made a name for herself advocating for girls and women to pursue careers in science.
“Although I am the namesake of Sara Lee Bakery products and grew up in the baking industry, I do not bake,” says her bio on the 1000 Cookbooks app.
“I cook and enjoy everything about being in a kitchen.
“Today, my main goal is to support female STEM (science, technology, engineering and mathematics) scientists and programs that encourage young women to engage in STEM.
“People don’t think cooking is a science, but it is. So let’s do it!'”