TORONTO — Herbal Magic, Canada’s largest chain of weight loss centres, has shut its doors at locations across the country.
The company says 41 Herbal Magic centres in B.C., Alberta, Saskatchewan and Manitoba would be taken over by a secured lender and continue operating. The company’s website said it has about 150 locations across Canada.
“Herbal Magic has long been a leader in Canada’s weight loss market. However, it has become evident that Herbal Magic’s national business model is not viable in today’s changing weight loss market and significant changes were required to our business,” Philip Quirk, the company’s chief financial officer said in a prepared statement.
Quirk noted that the company’s secured lender, 9302751 Canada Inc., acquired 41 Herbal Magic stores in B.C., Alberta, Saskatchewan and Manitoba.
“Unfortunately, this refocusing on Western Canada will require the closure of all Herbal Magic centres in Central and Eastern Canada and certain centres in Western Canada.”
“To our clients and staff affected by the centre closings, we thank you for your support over the years. “
Arman Kedilerli, 39, said he paid about $3,800 upfront in May for a 12-month program, but arrived for his weekly weigh-in at an Herbal Magic location in Woodbridge and was told the store was shutting down permanently and that all locations in the province were as well.
“I am realizing now with this closure I’m out a lot of money because I prepaid for everything, I’m not going to receive everything I paid for,” he said, adding that his health coach told him she had bad news when he arrived Friday morning.
“When I got there she was in tears because she just found out she was out of a job and the place was closing and she had to kind of deliver all this news to people and she herself was receiving the news.”
Kedilerli said he was a previous client of Herbal Magic and returned in May because they had offered him incentives to rejoin, by lowering some of the fees if he agreed to pay upfront.
He said he thought his health coach was only referring to one location, but she then informed him that all of the company’s stores in Ontario would be shuttering their doors for good.
“She was quite upset she said, ‘We just got news received through email that we’re to lock the doors and just kind of close up and head office will be by to pick up the files at some point and that’s that,'” Kedilerli said, adding that he then went on their Facebook page for more information and found several clients in the same situation.
“I have been messaging back and forth with some of the clients in different parts of the province and they’re kind of in the same position; doors are locked today and hearing that they’re going bankrupt or have gone bankrupt and employees are just out of a job.”
Global News obtained an email allegedly sent to employees by Dorianne McKenzie, Vice President of Sales for Herbal Magic, in which she details how employees are to proceed by printing off a “centre closure sign.”
“Please print out, put on door immediately and lock the centre door,” the email read.
“Please note Shredex will be arriving as early as 9 am to pick up ALL client files. Please have them ready for pick up. Please avoid client interactions until you’ve received all information in the conference call.”
The company’s operations in Eastern Canada were put into bankruptcy Thursday through Pricewaterhousecoopers Inc. and the firm filed an intention to claim for creditor protection last summer and the same company was appointed as trustee.
Herbal Magic has not responded to repeated requests for comment from Global News.
Kedilerli said he has lost 50 pounds since May with the program and that he had a generally positive experience with the company.
He said his only option now was to begin the process of trying to get back the $3,800 back that he had invested.
“I’m on a weight loss journey so I have to figure something else out as far as where do I go next because I am not yet at my goal … I was really looking forward to losing another 50 [pounds] and i was feeling good about it,” he said.
“I will have to do something I just don’t know where, I’m kind of a little bit still frazzled as far as what had happened.”
With files from Brian McKechnie, Heather Loney and Adam Frisk
© 2015 Shaw Media