Shropshire haulier Secal Logistics has closed down after being undercut by “single person operators” operating on wafer thin margins, according to its liquidator.
The business, which for the last five years had been trading out of the Tweedale industrial estate in Telford, ran 19 lorries and distributed a range of goods within the retail, gaming and recycling sectors.
It had been operating since 2004 and at the time of its closure employed 19 staff.
Insolvency experts at Lucas Ross were appointed to the transport firm last month.
The liquidator said the company’s directors had reached a stage where they “could not see how a fundamental shift in their sector would reverse”.
Kevin Lucas at Lucas Ross said: “An upsurge in competition from local single person operators - targeting local manufacturers and undercutting prices to operate at margins only single person operators can survive on - caused the company to incur a loss in its final year of trading.
“This coupled with increases in employers’ National Insurance led to our conclusion.
“In addition, with long standing and loyal staff, the employment costs of any closure were only growing as time went by, meaning the directors needed to avoid the personal liability risk that arises from increasing the potential losses to creditors.
“The directors therefore took the very difficult decision to cease trading.”
Secal Logistics’ statement of affairs showed that it was estimated to owe just under £130,000 to all its creditors, with around £72,000 owed to HMRC.
Lucas added: “Assets owned by the company and not on hire purchase were nearly all sold in the run up to liquidation, generating a positive return for creditors.
“Based on current information it is likely preferential creditors will receive full repayment of their debts, whilst there may be a very small return to unsecured creditors.”
