nearly a year, well-known logistics companies closed down, layoffs. And just a few days ago, another logistics giant declared bankruptcy.
British express logistics giant declares bankruptcy
Local time 12, failed in the past few weeks to obtain financing, the British express logistics giant "Tuffnells Parcels Express" announced the final bankruptcy liquidation, and appointed Interpath Advisory as a joint administrator.
The logistics giant has faced increasing costs, a new crown epidemic and a highly competitive UK parcel delivery market in recent years.
Tuffnells Parcels Express is a British freight logistics company founded in 1914 and headquartered in Kidderminster, Northamptonshire, England. The company provides nationwide parcel delivery services, transportation services for heavy and overweight goods, warehousing and distribution solutions, etc.
Tuffnells Parcels Express in the UK has more than 30 operating branches, with many years to establish a global partner network, is the UK domestic and international logistics market competitive transport enterprises.
Interpath Advisory Managing Director and Howard Smith's co-manager Richard Harrison said: "Unfortunately, the highly competitive UK parcel delivery market, coupled with recent significant inflation in the company's fixed cost base, has led to significant cash flow pressures."
Tuffnells Parcels Express is one of the UK's largest parcel delivery companies, with 33 warehouses handling shipments from more than 160 destinations worldwide and over 4000 business customers. The company specializes in delivering mixed shipments and handling irregular-sized packages.
A of 500 contractors will also be affected by the bankruptcy liquidation, Tuffnells Parcels Express transportation hubs and warehouses will be closed until further notice.
The news is also likely to give waiting packages to global businesses and consumers with Tuffnells retail customers such as Wickes and Evans Cycles who will be waiting for furniture or bicycles and other big-ticket items to be delivered.
Harrison said: "Regrettably, due to the delivery suspension, which cannot be resumed in the short term, we have had to lay off most of our staff. Our first priority is to provide all those affected with all the support they need to file claims with the redundancy payment office and to minimize customer disruption.
In the company's latest results for the year ended 31 December 2021, the company reported turnover of £ 0.1781 billion and pre-tax profit of £ 5.4 million, compared to 16 months ended 30 December 2020 with revenue of £ 0.212 billion and post-tax profit of £ 6 million.
At the time, the company's non-current assets were valued at £ 13.1 million and current assets at £ 31.7 million.
Logistics companies close down, layoffs continue
not long ago, India's well-known digital freight forwarder "Freightwalla" announced the closure. The company was once the top 10 in the Asia-Pacific region of the top freight forwarding start-up companies.
and just in China, a cross-border e-commerce FBA logistics head enterprise is also suspected because of a large amount of arrears led to the capital chain break, facing closure. At present, a large number of shippers, sellers and freight forwarders have gathered at the door of the enterprise to wait for processing.
In addition, many companies have laid off workers.
Before, project44 laid off 10% of its staff. The leadership said the restructuring move comes amid various headwinds in the industry and the economy, which presents a big challenge for venture-backed FreightTech startups.
Flexport January layoffs 20%, global logistics and U.S. trucking giant C.H. Robinson recently announced another layoff of 300 people, which is the company after November 2022 layoffs of 650 people, 7 months of second layoffs.
Digital freight platform Convoy announced restructuring and layoffs in February. Embark Trucks, a self-driving truck start-up, laid off 70% of its employees in March. Truckstop.com, a traditional freight stowage platform, also announced layoffs, the exact number of which is unknown.
Market demand is weak, freight forwarding competition is fierce
About freight forwarding companies have closed down the reasons, have to mention the external environment.
Russia-Ukraine war, unprecedented anti-globalization trend, resulting in Europe and the United States major consumer markets need to be extremely weak, which directly affected the global trade volume decline, but also directly affected the supply chain an important part of the international freight forwarding business volume.
In the business volume shrinking at the same time, the market competition is more intense, resulting in freight forwarding enterprises gross margin fell sharply, and the cost in the past few years, may be due to disorderly expansion and further rise, this is long, many freight forwarding enterprises operating pressure increased sharply.
As for the fierce competition in the market, it is mainly due to the weak global demand that has had a certain impact on the freight forwarding industry. When economic growth slows or international trade is constrained, the demand for cargo transportation tends to decrease.
this case, the freight forwarding company may face fewer orders for the transportation of goods and lower freight rates. In addition, global supply chain instability can also lead to a decline in business, as companies and consumers may delay or cancel purchase and shipment plans.
second, the freight forwarding industry competition is a long-standing phenomenon. There are a large number of freight forwarding companies and fierce market competition, which leads to low profit margins and smaller profit margins.
freight forwarding companies need to remain competitive by continuously improving efficiency, optimizing costs and providing better customer service. Only those companies that can adapt to market demand and adjust their strategies flexibly can survive in a competitive environment.
Source: Ningbo Shipping