As reported last week, Max Brenner Australia has blamed escalating costs and tighter retail trade for its collapse, with partners from Sydney-based firm McGrathNicol appointed voluntary administrators of the business.

McGrathNichol partner Barry Kogan said in a statement that following an “urgent review” it had been decided to close 20 of the 37 stores from 5pm today (October 8), with staff working at the affected outlets to be made redundant.

A spokesperson was unable to tell InDaily this morning how many employees would be affected by the closure of the Rundle Street store, which is the only Max Brenner outlet in South Australia.

It opened in December 2016 on the site previously occupied by Eros Ouzeri restaurant at 277 Rundle Street, in a location already well served by chocolate shops including Cocolat, San Churro and Steven ter Horst Chocolatier.

The Max Brenner stores that are closing are those the review found to be unprofitable, and include one each in the ACT, Northern Territory and Victoria, five in NSW, nine in Queensland and two in Western Australia.

“The decision to close stores is always regrettable but in this case we were left with no choice following a store-by-store review of Max Brenner operations,” Kogan said.

“The remaining 17 stores in the Max Brenner network will stay open and it will be business as usual in these stores. These stores are profitable and will be offered for sale or recapitalisation.”

The Max Brenner franchise was created in Israel in 1996 by chocolatiers Max Fichtman and Oded Brenner and spread to Australia in 1999, with the Australian business now employing around 600 staff.

In its statement, McGrathNicholl said the decision to close 20 stores and terminate employees “was made with careful consideration of all options available to keep the remaining business trading and effect a sale”.