Brit European Transport has pulled out of the UK carpet distribution business following the voluntary liquidation of its Belgium-based sister company, which specialises in the warehousing and distribution of carpets to the UK.
The company insisted that the demise of Zeebrugge-based Brit European Transport NV would not have any long term impact on the group’s business in the UK.
The company said the voluntary liquidation was prompted by “unsustainable” delivery rates, high employment costs, foreign exchange pressures and European red tape. MT understands that the vaule of the the carpet distribution business is less than €10m (£7m) in annual turnover.
The move follows Brit European Group’s decision last year to take over the UK distribution of carpets from its Belguim-based sister company. The restructuring was part of a wider attempt to turn around the ailing business.
The closure of Brit European Transport NV, which was announced to employees last week, sees the Belgian company and all its assets, including its warehouse, trucks and trailers, handed over to the courts as part of the country's administration procedure.
An estimated 5,000 rolls of flooring is housed in Brit Europe’s warehouse in Belgium. Dutch transport company Verhoek is understood to have taken on the delivery of some of the stock.
In a statement MD Graham Lackey said the closure “will have little or no effect on the Brit European UK operations, which are best known for its work in the automotive and high and heavy sectors, and which accounts for over 80% of the total group”.
Lackey said the company had struggled for four years, adding that market pressures including falling volumes, low delivery rates, high employment costs in Belgium, the cost of cabbotage and a weak euro had “led to crunch customer discussions as costs continued to increase against static market rate”.
Lackey added: “It is a disappointing and sad outcome but one which highlights the challenges of operating across borders with differing interpretation of what is in theory common European legislation. It also highlights the dangers of manufacturers pushing rates for specialist transport providers too hard.”
Brit European Transport (Holdings) had flagged up problems at its subsidiary last month when it reported its 2014 annual results, describing the performance of its European business as “unacceptable”.
It said at the time that it was trying to turn the business around but was struggling to reduce overheads in staff and management because the country's employment law made this “a very slow and costly process.”
The Belgium business
Brit European Transport's carpet distribution division delivered to around half the independent flooring retailers and wholesalers across the UK, as well as flooring giant Carpetright. Its Belgian subsidiary's 8,000m² warehouse in Zeebrugge had capacity for up to 5000 rolls of carpet and 1500 pallets.
