International haulage firm Joyce European Logistics was “greatly affected” by Brexit before being hit with twin body blows from Covid and the driver shortage, which precipitated its slide into administration.
The haulier operated out of three bases in the West Midlands traffic areas and had grown from a sole trader operation that began in 2009 into a limited company with 13 members of staff running 10 HGVs out of sites in Shrewsbury and Market Drayton.
Administrator SPK Financial Solutions said the business was responsible for shipping goods across the UK and throughout Europe, but when the UK left the EU at the end of January 2020, its problems began.
In a report to creditors, SPK explained: “Sales were reduced as some customers stopped exporting due to increased costs and the complexities of export customs procedures.
“There was also an increase in transit time due to additional paperwork and many border delays as new procedures were introduced.
“Customers were reluctant to pay any additional transport costs for this though and expected the haulier to absorb them.”
Joyce European increased the number of staff it employed to handle the huge increase in administration on every export and import and this led to additional costs that were not being recovered from the end customer.
Its difficulties were compounded during 2020 with the Covid-19 lockdowns and although it was able to continue trading as staff were classed as essential workers, the temperature-controlled work was at a reduced level, causing margins to slide further and volumes to shrink.
“The company was then hit with the driver shortage and pay for Class 1 European drivers had to be increased to keep pace with the market conditions,” SPK said.
“Volumes and margins continued to be squeezed.”
A decision was made to pivot into double-deck trailer operations, which the administrator said was initially very successful, but over time the increased competition and too many trucks chasing the same work ultimately meant the haulage work was unviable.
Joyce European also took on loans, including from its invoice financing company, but the payback rate and charges served only to compound its cash shortages and when the hoped-for trade did not return at the end of 2024, it finally entered administration on 11 February.
SPK is now attempting to realise property in order to make a distribution to creditors and it is currently in the process of selling the haulier’s Wem industrial estate, Shropshire, land and buildings to the resident next door for £150,000.
However, with unsecured claims estimated to be more than £481,000, SPK added that it was not anticipated trade creditors would receive any money.
