Parcel delivery firm Tuffnells Parcels Express has filed a notice of intent to appoint administrators and is expected to formally announce administration on Monday (12 June).
Law firm TLT LLP filed a notice of administration on behalf of Tuffnells on Friday (9 June). The Sheffield-based IDW carrier called its drivers back to the company's 33 depots on the same day and instructed its 2,300 employees to go home on Friday afternoon.
Tuffnells, which was also known as The Big Green Parcel Machine, was sold by the Connect Group in a management buy-out for £15m in 2020. At the time Tuffnells was making losses of around £14m on annual revenues of £164m but returned to profit just six months after the MBO.
In the first full year back in private ownership, Tuffnells Parcels Express generated £178m in annual revenue and £5.5m of pre-tax profit. In 2021 it underwent a management restructuring.
In February this year the company announced a £7m investment into the business, focusing on route optimisation technology.
In March Tuffnells executive chairman Michael Holt told MT of the challenges the firm faced. He said: “Margins are being squeezed. You’re doing really well if you’re getting 4% to 5% margin. Cost of labour has gone up, and the cost of recruitment, and the cost of gas and electric at the sites. It’s a huge electric and heating bill."
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He added: “This year we will live or die by the amount of new business that we generate. Last year there was a record number of insolvencies and they’re predicting a record number again this year. You’ve got to pedal harder and faster to bring in new business. Take your eye off that for a minute and you go backwards.“
Holt told MT that this year he was aiming for turnover of £180m and profit in the region of £4m to £5m, but admitted it would be “challenging off the back of last year,” when the company benefitted from the impact of the Covid-19 pandemic on delivery volumes.
Tuffnells' move to file for administration comes just two days after rival DX Group announced it had reached a confidential settlement with Tuffnells in relation to a legal case involving alleged corporate espionage by DX employees to obtain daily customer service reports from Tuffnells, in October 2020. DX said the settlement is without any admission of liability.
