Abrupt Closing: Sucré, Post-Katrina Success Story, Closes All Stores: A Reminder That Appearance Isn’t Everything When It Comes to Business

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Sucré, well-known for its designer desserts and clean, upscale appearance defied the odds when it opened in 2007 and quickly becoming the go-to confectionery for desserts. It was an immediate success and eventually developed multiple locations and a wholesale operation which sold its desserts during holiday seasons and through other retail stores.

Sucré even challenged the deeply entrenched King Cake industry winning best cake in a 2011 Washington Post blind taste test. Sucré seemed to be embracing healthy growth with a strong foundation, so it came as a shock when customers were met with “Permanently Closed” signs taped to the doors of all of Sucré’s locations this week.

How does such a well-established business suddenly close all operations?

In an online statement to its customers, Sucré’s Board of Managers stated “[o]ver the past year, our executive team has operated in a responsible manner and has attempted to bring the company to financial profitability.” Whether this holds to be true, time will certainly tell. But with all of Sucré locations shuttering at once, there seems to be more than responsible attempts at financial profitability to blame.

What happens when a business such as Sucré ceases operations?

In Louisiana, businesses such as Sucré are established by creating a juridical or business entity such as a limited liability company (“LLC”). Once established, many businesses prefer to operate by contract or what is known as an operating agreement. An operating agreement controls how the LLC is to handle certain situations. One of those situations is called winding up, the manner in which a business ceases operations and liquidates its assets.

However, when businesses don’t address the procedure for winding up in their operating agreement, the laws provide winding up may occur by appointing a liquidator. A liquidator is a court-appointed person who steps in control of the business and is tasked with the duty to pay off debts and sell off assets. Essentially, the liquidator sells off all assets and goods of a company and brings the company to an end.

Is Sucré gone for good?

It is possibly Sucre could restructure its operations and give it another shot. However, based on its closing statement, it appears that Sucre has exhausted that avenue. More likely is that the business will be liquidated. In liquidation, someone could purchase the rights to the name Sucré, its 37,000 social media followers, and recipes and continue on with the well-regarded dessert shop. Sucré had become an icon in New Orleans and was gaining more and more national attention, but for the time being, the Crescent City seems a little less sweet.

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