Organic supermarket chain insolvent - protective shield procedure applied for in Munich

Created: 12/21/2022, 10:25 am

By: Patricia Huber

Organic food is becoming unaffordable for more and more people.

This has now also been fatal to a Munich organic supermarket.

Munich – Inflation has been at record levels for months.

This is also causing consumers to reconsider their supermarket choices, leading to the increasing popularity of discounters.

The comparatively expensive organic supermarkets are at a disadvantage - including the organic market chain Basic, which is now in trouble.

The company has now applied for a protective shield procedure at the Munich district court in order to restructure itself.

The district court of Munich has already followed the application for this variant in insolvency law. 

Basic organic market broke: customers show restraint

As in most other German organic supermarkets, the price increases for food have led to consumer restraint, the statement said in a statement.

Although most customers are loyal, 15 percent are switching customers who are holding back in view of the high inflation.

Added to this are the sharp rises in energy costs, which are particularly affecting retail with its large areas.

The company is not insolvent, the statement said.

The salaries of the approximately 520 employees in the 20 German branches are secured for three months by the Federal Employment Agency.

The branches will also remain open, with the same range.

The Munich-based chain operates 20 branches in Germany, most of them in Bavaria.

Basic is the third largest organic supermarket in Germany, after Dennree and Alnatura, and is one of the oldest organic markets, founded in Munich in 1997.

Basic: Reorganization of the subsidiary as a financial burden

According to Basic, there are also financial burdens from the restructuring of the smaller organic supermarket chain Biomammut, a subsidiary.

According to the information, the Management Board of Basic AG will now develop a restructuring plan together with the restructuring consultants and in coordination with the trustee and creditors.

The board of directors and consultants assumed that the restructuring process could be completed in the summer and that Basic AG could get off to a flying start.

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Organic products should be available to everyone, that was the idea behind it.

The first supermarket opened in Munich's Schwabing district in 1998, and the second branch opened in 2000 at Viktualienmarkt.

Basic opened another shop in Munich in the Moosach district at the end of November.