Huge dessert chain with 100 locations forced to close shop after franchise owner failed to ‘pay a penny in rent’
A MASSIVE dessert chain with 100 locations across the UK has been forced to shut after the landlord failed to “pay a penny in rent.”
The desert parlour, based in Basildon, was slapped with a penalty notice by the council – which chased the owner for payment for three years.
Kaspa’s desserts, recognisable for its neon purple decor and sweet treats, is a well-known high-street name.
Located on the ground floor of the Vue cinema complex in the middle of the town centre, residents were shocked to see the staple store scrapped.
The self-proclaimed “King of Deserts” was however dethroned by Basildon Council which handed it a forfeiture notice after the parlour failed to pay.
Council leader Gavin Callaghan shared the surprising news on social media.
In a post on Facebook, he wrote: “Kaspa’s have been in arrears on their rent since 2022.
“In fact, they haven’t paid a penny in rent, despite signing a contract to say they would.”
A notice placed in the desert shop window stated the council had taken back control of the lease following the rent scandal.
Kaspa’s was reportedly very popular in the area, which left locals baffled about them not being able to cough up rent.
With a menu that includes fettuccine Crepes, white bueno waffles, and a frozen millionaire cheesecake treat pot, it’s clear the pudding parlour will be missed
Despite this, Callaghan said the store understood that if they continued to avoid paying rent another tenant would have to replace them.
He added: “They’ve been aware for months that the council was chasing the rent arrears and that action would be taken if they failed to pay.
“They only provided partial accounts and still to this day, haven’t provided the full accounts.
“We have worked with them to try and improve customer numbers and business performance and offered them the chance to put seating outside on the pavement to boost trade, but they’ve declined.”
Callaghan claims the council attempted to work with Kaspa’s to boost business but they were not cooperative.
Only if the desert store is able to prove it pays rent or substantiate claims it doesn’t make enough money to pay rent, then the site might be reopened.
However, if Kaspa’s is unable to prove either of these claims a new tenant will fill the unit.
The Facebook post continued: “No one wants to see a business close, but there are two sides to every story and the council has to protect the taxpayer and the taxpayer’s investments.”
Kaspa’s business model is based on franchising, which means independent operators are in control of local stores.
The franchisees, owners of local branches, invest in setting up their own stores and managing the shop.
Franchising is a hugely popular business model, and it is implemented in restaurants like McDonald’s, KFC, and Domino’s.
In this case, paying rent would be the responsibility of the franchise owner and not the wider company.
One social media user took to the comments to express how stunned they were about the situation.
They wrote: “Business owners I’ve spoken to in the past few days that are aware of the Kaspa’s Basildon situation are all appalled that a business expects to be allowed to continue to operate when in such large rent arrears.”
Cllr Jessica Power shared the post and responded: “We don’t take these decisions lightly as a council.
“We work to support businesses and want to see Basildon return to the thriving town centre it should be!”
The Sun has reached out to Kaspa’s Basildon for a comment.
Why are retailers closing stores?
RETAILERS have been feeling the squeeze since the pandemic, while shoppers are cutting back on spending due to the soaring cost of living crisis.
High energy costs and a move to shopping online after the pandemic are also taking a toll, and many high street shops have struggled to keep going.
However, additional costs have added further pain to an already struggling sector.
The British Retail Consortium has predicted that the Treasury’s hike to employer NICs from April will cost the retail sector £2.3billion.
At the same time, the minimum wage will rise to £12.21 an hour from April, and the minimum wage for people aged 18-20 will rise to £10 an hour, an increase of £1.40.
The Centre for Retail Research (CRR) has also warned that around 17,350 retail sites are expected to shut down this year.
It comes on the back of a tough 2024 when 13,000 shops closed their doors for good, already a 28% increase on the previous year.
Professor Joshua Bamfield, director of the CRR said: “The results for 2024 show that although the outcomes for store closures overall were not as poor as in either 2020 or 2022, they are still disconcerting, with worse set to come in 2025.”
It comes after almost 170,000 retail workers lost their jobs in 2024.
End-of-year figures compiled by the Centre for Retail Research showed the number of job losses spiked amid the collapse of major chains such as Homebase and Ted Baker.
It said its latest analysis showed that a total of 169,395 retail jobs were lost in the 2024 calendar year to date.
This was up 49,990 – an increase of 41.9% – compared with 2023.
It is the highest annual reading since more than 200,000 jobs were lost in 2020 in the aftermath of the COVID-19 pandemic, which forced retailers to shut their stores during lockdowns.
The centre said 38 major retailers went into administration in 2024, including household names such as Lloyds Pharmacy, Homebase, The Body Shop, Carpetright and Ted Baker.
Around a third of all retail job losses in 2024, 33% or 55,914 in total, resulted from administrations.
Experts have said small high street shops could face a particularly challenging 2025 because of Budget tax and wage changes.
Professor Bamfield has warned of a bleak outlook for 2025, predicting that as many as 202,000 jobs could be lost in the sector.
“By increasing both the costs of running stores and the costs on each consumer’s household it is highly likely that we will see retail job losses eclipse the height of the pandemic in 2020.”