Brosa furniture collapse: Customers unleash after Kogan buys company but fails to fulfill orders

Furious customers of collapsed luxury furniture retailer Brosa are fuming about getting spammed with emails about ‘loving your new sofa’ – when they have no idea if their couches and coffee tables will ever be delivered.

The trendy Australian store – once described as the country’s largest online retailer – went into liquidation on January 31, after plunging into voluntary administration late last year. 

Brosa exploded in popularity online during the Covid pandemic when house-bound buyers sought to upgrade their homes, but it went under post-lockdown as customers returned to physical stores, and battled inflation and a struggling economy.

The collapsed business reportedly has $4.3million in assets but owes $24million including $10million in unfulfilled orders.

Emma, one of the many customers who is still waiting for her order to be delivered from Brosa, told Daily Mail Australia this week that the retailer has been emailing her asking to review her non-existent lounge.

Brosa has been placed in liquidation following an overwhelming vote from creditors (Brosa shop front shopfront in Melbourne)

The email from Brosa asking Emma if she was loving her new sofa – that was yet to arrive

Emma had taken a day off work to wait for her three-seater Austin sofa, which she bought for for $1,700, to be delivered on November 15. 

Her delivery never arrived and when she called to find out where her order was she said the phone lines had all been disconnected. 

Emma found out Brosa went into liquidation and said she is ‘one of the lucky ones’ because her order is ‘allocated’ – meaning it should eventually be delivered.

Online retailer Kogan, which bought the remains of the Brosa business from administrators for just $1.5million, had assured her it would update her about the sofa by the end of January but that never happened. 

‘There have been no other updates, I keep emailing and I get nothing back, I just get a generic email,’ she said.

Emma received a text from Brosa confirming the delivery of her sofa however, her order never came and has been frantically trying to contact Kogan to organise delivery before the February 17 cut-off

‘They never write back. I’m worried it will get to the February 17 and I will get nothing at all because it will be treated as abandoned stock.

‘I have contacted ING and told them to process a chargeback but they have to prove there was meant to be a delivery. I was initially told it would take 15 days but now I’m being told it will take 45.’ 

Emma said the ordeal has put her off ordering from online stores. 

‘We really saved a lot for that couch and I just want to know if we’re getting one or not,’ she said. 

‘We have done a complete renovation of our house and our living room is just empty. What’s really frustrating is that the sofa is available for presale on both Brosa and Kogan’s website.

‘On the one hand I am one of the lucky ones and on the other hand I am not  because we’re still waiting. Only time will tell.’

Emma recently renovated her home but her ‘sad empty lounge room’ only has beanbags and no couch to sit on (pictured)

Under the terms of its purchase of the Brosa business, Kogan committed to delivering orders already paid for, but the sheer number of unfulfilled orders has  set back that process.

It’s understood the company has more than 5,000 unfulfilled orders, including 2,790 orders of ‘unallocated stock’ – products that are not yet made or not in the business’ warehouse. 

Queensland customer Kylie Phelan told Daily Mail Australia she purchased the Palermo three-seater couch with a stain guard for $2,307 through the Afterpay website in November.

Queensland customer Kylie Phelan purchased a Palermo three-seater couch with stain guard for $2,307 through the Afterpay website before Brosa went into liquidation. She has not received her order or any of her money back

After making three payments, Ms Phelan was contacted by the administrators in January advising her Brosa had gone under and her order had never been placed – making her an unsecured creditor. 

Ms Phelan said she immediately contacted Afterpay but was told to wait two weeks while Brosa ‘allocated its stock’.

‘Another two weeks passed and I have heard nothing. Kogan advised me my stock is unallocated and I will never receive my purchase and to lodge a proof of debt form,’ Ms Phelan said. 

‘I emailed Afterpay multiple times asking to be contacted via phone and email I informed them I did not want the final payment to come out until it was resolved.’

The Queensland nurse completed a complaint form with the buy now, pay later service and emailed the company requesting the final payment not be made.

However, on January 28, Afterpay processed Ms Phelan’s final payment and her dispute was deleted from her account. 

Ms Phelan said she has contacted Afterpay, Kogan and the administrators several times and has not received any help, with her emails now going unanswered.  

Ms Phelan said her order became ‘unallocated stock’ even though the Palermo three-seater couch is still available on Brosa’s online clearance sale 

‘I’m extremely frustrated by the whole process. It’s impossible to get answers from anyone,’ Ms Phelan said, 

‘Afterpay will not respond to my emails at all, and Kogan/KordaMentha is just a generic email.’

‘$2,300 lost. I am a nurse so I don’t earn a lot of money which is why I paid through Afterpay. All the extra shifts I did to pay it off were for nothing.’ 

Afterpay told Daily Mail Australia on Tuesday that some customers were identified as having paid for orders they never received. 

‘All customers impacted by the liquidation in question have been contacted and offered a solution, which are either resolved or in the process of being resolved,’ Afterpay said. 

Melbourne customer Audrey told Daily Mail Australia the treatment she received from administrators, Brosa and Kogan had been ‘absolutely disgusting’. 

Audrey ordered a bed from the retailer but when the company went into administration her order was also labelled as ‘unallocated stock’. 

Melbourne customer Audrey said she has been ‘sleeping on the floor’ (pictured) because she has not received her Brosa order, which has since been deemed ‘unallocated stock’

‘I am sleeping on the floor with half a bed and no definite answers and I haven’t received my order or a refund,’ Audrey said.

‘This whole situation was just a smash and grab! The administrators swooped in and fed on the Brosa carcass, then Kogan swooped in and took the IP. 

‘They both asked us to leave them alone to figure things out.’ 

Audrey sought answers from Brosa and Kogan, as she too was still being charged on Afterpay for her order, but was asked to be patient. 

Melbourne customer Audrey reached out to Brosa (left)  and Kogan.com (right) with her concerns but was asked to have patience as the companies process thousands of queries

Customers were directed to complete a ‘proof of debt form’ at the second creditors meeting on January 31. 

‘I think Kogan is waiting to reply after the cut-off date, so hopefully a large percentage of the stock will be seen as abandoned due to the customer not filling it in,’ Audrey said.

‘They just got what they wanted and are stalling us until February so they can settle in.’

Another Melbourne customer, who did not want to be named, told Daily Mail Australia half of her $7,500 order was classed as ‘unallocated’, including pieces of a modular couch. 

‘They [Kogan] sent me an email saying half of the couch is unallocated but we will send you what is allocated,’ she said. 

‘Why would I want half a couch? I asked for a refund or at least a credit to which I’m still waiting on a response.’

The outraged customer said she scrolled through the retailer’s website and found the modular lounge was still available -on sale – despite being told her order could not be fulfilled.      

‘I couldn’t believe my eyes when I saw my unallocated couch for sale at a way cheaper price on the Kogan website,’ she said. 

She said her order was made prior to the company’s collapse and is disputing the lost money through her bank. 

NSW customer Elle spent $2,222 during the Black Friday sales on November 25.

Elle purchased a Palermo sofa and five-year protection warranty for the item – but the sofa was marked as ‘unallocated’. 

‘Why would I need warranty for an item that I am never going to get,’ Elle told Daily Mail Australia. 

Elle lodged a ‘proof of debt’ form with the administrators and a dispute with her bank in hopes to get her money back. 

‘It’s been a super long process with all the calls and emails. I haven’t got any emails back because no one wants to get back to you.’

NSW customer Elle (pictured with her husband) paid for a sofa and five-year warranty for her item but was later told her sofa was ‘unallocated’ despite it appearing on the online store 

‘It’s super frustrating because Kogan is selling the same sofa online, so it’s obviously still getting made. It’s just a big slap in the face. 

‘It took us a while to save for the sofa but we’re lucky that we only bought a sofa. Other people bought furniture for their entire home and have not received their order and are unlikely to get a refund.’ 

Administrators Richard Tucker and Michael Korda from insolvency firm KordaMentha refuted one claim made by disgruntled customers.

Brosa, which was bought by e-commerce store Kogan.com, announced a warehouse stock clearance sale as part of its voluntary administration (pictured)

‘Some customers claim that their furniture is being sold again to other customers,’ KordaMentha told Daily Mail Australia. 

‘This is not true. Brosa had some furniture not allocated to customers … and did not belong to customers. This was sold to Kogan to help pay creditors of Brosa.’ 

Customers with ‘unallocated stock’ are being advised to claim a chargeback from their bank or credit card provider.

Those who cannot do that can register as an unsecured creditor but are unlikely to get any money back once the administration process pays out employees and secured creditors. 

Customers with allocated stock have until February 17 to decide whether to wait for their order to be delivered or accept a Kogan credit. 

After February 17, any unclaimed stock will be deemed ‘abandoned’ and will be legally the property of Kogan. 

Kogan.com did not absorb Brosa’s reported $24million of debts but confirmed it intends to relaunch the business.