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City Link Goes Into Administration

City Link, the Parcel Delivery Business has gone into administration with the loss of over 2,000 jobs.

After years of substantial losses the company is no loger accepting parcels from its customers.

Comments

  • After years of cutting the arse out of independent couriers with their ridiculous low costs I ain't surprised
  • Pitched for some restructuring work with them a couple of years ago and could tell immediately they were extremely poorly run. Their systems were awful, the infrastructure was creaking and the senior management didn't know their arse from their elbow (and I'm not just saying that because we didn't win the work!!).
  • They started really well I was using them loads at one stage, then the wheels started to fall off, as you say the infrastructure was rubbish, I managed to find a few of the guys who seemed to do the work for them still working for themselves, and the way they were having to quote on work was bang out of order, the courier exchange was taking stupid %s just so these guys could work, and city couriers was using that system, not surprising they have tumbled under, too fast too soon
  • We stopped using them about a year go, they had a lot of restructuring and it didn't seem to work. I thought they were part of the Rentokil group.
  • After years of cutting the arse out of independent couriers with their ridiculous low costs I ain't surprised

    Yes, nail on the head! Sorry to hear about the job losses which is always terrible but good riddance to a shit business. Hope those whose are losing their work can pick something up quickly.

  • Our company have been using them for years because they were so much cheaper than the competition. They were alright up to about 3 or 4 years ago when they streamlined the local depots.

    Since then we've had problems all the time, but they kept our business purely because of the low base cost of sending consignments.
  • We stopped using them about a year go, they had a lot of restructuring and it didn't seem to work. I thought they were part of the Rentokil group.

    Rentokil sold it for £1 last year.

  • Sad news, loved that they would pick up and deliver, thus bought a few guitars and a garden shredder on ebay and used them.
    Everything on time and well treated.
    Best wishes to those who lost there jobs.
  • Disgraceful way to treat the employees by the administrators. Why not tell them last Friday or delay the announcement for a a few days. Christmas day FFS.
  • Disgraceful way to treat the employees by the administrators. Why not tell them last Friday or delay the announcement for a a few days. Christmas day FFS.

    Not actually the Administrators fault though is it? They can't continue to trade if the business is insolvent with no prospect of selling it off as a going concern. That would be fraudulent.

    If the owners decide to put the firm into admin, then what are they supposed to do?

    Clearly the administrators have to let ALL stakeholders know what's going on. What's the alternative? Not tell the staff anything but stop taking orders/making deliveries - how would that work?

    Blame firmly at the door of the old management on the timing issue.

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  • Its the letting them know on the Christmas day I thought was cowardly. Sure it was the not the administrators fault that the company is folding but announcing the good news yesterday was a low blow. Why not not do the deed on a normal working day? The workforce would probably been expecting this to happen for quite a while anyway.
    They must be the only administrators that don't have one day off a year with their families. Whoever made that decision I hope they never have to see the effects that would of had in person.
    I doubt the old management had any say on the timing issue.
  • I used to have two franchised depots until seven years ago. The then franchisor management decided to buy back all the franchises for a pittance and there was nothing we could do about it.

    From that day Initial City Link went from a company making £30million a year profit to within a year making a £30million loss. They have been on a downward spiral ever since.

    The franchisees built the business and were then cast aside by the franchisor management who thought they could do better.

    Whilst I feel sorry for the normal working people I won't be shedding a tear if City Link disappear.

    Bitter, most definitely.



  • They certainly made some rough arse decisions affecting loads of decent hard working and good people, and yet again those decisions will affect more,
  • Its the letting them know on the Christmas day I thought was cowardly. Sure it was the not the administrators fault that the company is folding but announcing the good news yesterday was a low blow. Why not not do the deed on a normal working day? The workforce would probably been expecting this to happen for quite a while anyway.
    They must be the only administrators that don't have one day off a year with their families. Whoever made that decision I hope they never have to see the effects that would of had in person.
    I doubt the old management had any say on the timing issue.

    But City Link was a 24/7/365 business, so 25th Dec was a normal working day. The Administrators couldn't stop delivering and taking new business but not tell the staff as I suspect they would have guessed anyway.

    Ernst & Young were not appointed until 24th December. How could they have done anything differently? It must have been the old management who made that decision on timing. (Albeit with advice from their lawyers/accountants that to continue trading while insolvent may have resulted in the directors facing criminal charges in respect of either wrongful or fraudulent trading under the Insolvency Act 1986.)

    BTW, administrators are well used to working over the festive break. This is primarily because commercial rents are due by the old "Quarter Days" and 25th December is one of those. Bad pre-christmas trading, particularly in the retail industry, will lead firms to realise they can't pay the rent and to cease trading just before the fateful day when it is due. (Obviously the money has to be in the Landlord's account on 24th as the banks will not be open the next day.)
  • cafcfan said:

    Its the letting them know on the Christmas day I thought was cowardly. Sure it was the not the administrators fault that the company is folding but announcing the good news yesterday was a low blow. Why not not do the deed on a normal working day? The workforce would probably been expecting this to happen for quite a while anyway.
    They must be the only administrators that don't have one day off a year with their families. Whoever made that decision I hope they never have to see the effects that would of had in person.
    I doubt the old management had any say on the timing issue.

    But City Link was a 24/7/365 business, so 25th Dec was a normal working day. The Administrators couldn't stop delivering and taking new business but not tell the staff as I suspect they would have guessed anyway.

    Ernst & Young were not appointed until 24th December. How could they have done anything differently? It must have been the old management who made that decision on timing. (Albeit with advice from their lawyers/accountants that to continue trading while insolvent may have resulted in the directors facing criminal charges in respect of either wrongful or fraudulent trading under the Insolvency Act 1986.)

    BTW, administrators are well used to working over the festive break. This is primarily because commercial rents are due by the old "Quarter Days" and 25th December is one of those. Bad pre-christmas trading, particularly in the retail industry, will lead firms to realise they can't pay the rent and to cease trading just before the fateful day when it is due. (Obviously the money has to be in the Landlord's account on 24th as the banks will not be open the next day.)
    In that case I stand corrected.
    If things were that bad and the administrator acted that quickly things must have been in a very bad shape indeed.

    Still think who ever is responsible for the timing of the decision is cold, heartless shite.
  • You have to lay that responsibility at the hands of the management, not the administrators.

    They EY team, as any IP specialist will, will do all they can to try and keep a business running as it is far easier to sell as a going concern. I haven't seen CityLink's financials, but a few people here saying they have been making losses for several years.

    It does sound very dodgy though. EY were appointed after close of business on Christmas Eve saying that this was because there were "increasing level of rumours” that City Link was on the verge of collapse, leading to fears creditors would take action to protect assets. It was also the time when there were the lowest number of parcels in the system, which would result in the least disruption to customers and the general public, and would also minimise the level of claims against the company for non-delivery."

    That, to me, suggests that this business wasn't a going concern for at least some time before the appointment. Can see the management and firm's auditors being looked at carefully.

    Feel for the staff. There will be quite a lot more than the 2,727 quoted and it sounds like most will get their notices shortly. I hope they're back in work soon.
  • Chaz Hill said:
    There's some very silly stuff blended in with some truth and huge amounts of irrelevancy within that article. It rather indicates that neither journalists, politicians nor the union reps actually have any understanding at all of how company legislation actually works. Interesting though that they had 53 locations throughout the country. I suspect it was the rent due on those that was the final nail in the coffin.

    Here's an extract from E&Y's Boxing Day press release: "At this stage, no redundancies have been made amongst City Link Limited’s 2,727 employees. However, it is anticipated that there will be substantial redundancies over the coming days, as no buyer has been identified following a sale process for the Company and its business."

    So, the main thread of the mirror article - that the staff have been sacked (by a Tory fat cat) is actually complete fabrication: to date no one at the firm has lost their job. It's coming in all likelihood, just not yet.

  • cafcfan said:

    Chaz Hill said:
    There's some very silly stuff blended in with some truth and huge amounts of irrelevancy within that article. It rather indicates that neither journalists, politicians nor the union reps actually have any understanding at all of how company legislation actually works. Interesting though that they had 53 locations throughout the country. I suspect it was the rent due on those that was the final nail in the coffin.

    Here's an extract from E&Y's Boxing Day press release: "At this stage, no redundancies have been made amongst City Link Limited’s 2,727 employees. However, it is anticipated that there will be substantial redundancies over the coming days, as no buyer has been identified following a sale process for the Company and its business."

    So, the main thread of the mirror article - that the staff have been sacked (by a Tory fat cat) is actually complete fabrication: to date no one at the firm has lost their job. It's coming in all likelihood, just not yet.

    Wonder how much as hour E&Y will be charging eh?..... I know when a company went down owing me a rather small amount of money a few years back they were on about £180 an hour. In fairness, it is not the Administrators that caused this, but I cannot see what Vince Cable and his office can do, except send out warm words. The trouble is this causes a lack of confidence to the business world, I hear that the company was in trouble a month ago, but obviously the directors thought they could 'wing it'. Whatever happened to 'directors responsibilities'? The DTI always seem very reluctant to impose sanctions in my experience...... even with fraud is involved?....
    Personally I will not work for private individuals and small companies anymore, which causes me to miss out on a lot of new business, but no one got rich, by other people not paying...... that is unless you are an administrator, or in this business. Hopefully the poor 'workers' samll business's will get something out of this, after the IR, custom and excise, (VAT) and 'preferred creditors'..... banks etc........ I got 5p in the pound once , took 2 years though?
  • cafcfan said:

    Chaz Hill said:
    There's some very silly stuff blended in with some truth and huge amounts of irrelevancy within that article. It rather indicates that neither journalists, politicians nor the union reps actually have any understanding at all of how company legislation actually works. Interesting though that they had 53 locations throughout the country. I suspect it was the rent due on those that was the final nail in the coffin.

    Here's an extract from E&Y's Boxing Day press release: "At this stage, no redundancies have been made amongst City Link Limited’s 2,727 employees. However, it is anticipated that there will be substantial redundancies over the coming days, as no buyer has been identified following a sale process for the Company and its business."

    So, the main thread of the mirror article - that the staff have been sacked (by a Tory fat cat) is actually complete fabrication: to date no one at the firm has lost their job. It's coming in all likelihood, just not yet.

    Wonder how much as hour E&Y will be charging eh?..... I know when a company went down owing me a rather small amount of money a few years back they were on about £180 an hour. In fairness, it is not the Administrators that caused this, but I cannot see what Vince Cable and his office can do, except send out warm words. The trouble is this causes a lack of confidence to the business world, I hear that the company was in trouble a month ago, but obviously the directors thought they could 'wing it'. Whatever happened to 'directors responsibilities'? The DTI always seem very reluctant to impose sanctions in my experience...... even with fraud is involved?....
    Personally I will not work for private individuals and small companies anymore, which causes me to miss out on a lot of new business, but no one got rich, by other people not paying...... that is unless you are an administrator, or in this business. Hopefully the poor 'workers' samll business's will get something out of this, after the IR, custom and excise, (VAT) and 'preferred creditors'..... banks etc........ I got 5p in the pound once , took 2 years though?
    I agree, Ken, that insolvency professionals do seem to take a huge amount out of the pot to the detriment of ordinary creditors. One of the problems of course is that they have a lot of loss leaders - where there are insufficient assets to cover their costs, so the fees tend to be high when they can squeeze funds out of a defunct business. (I suspect, in this case, there won't be much by the way of assets to distribute. The vans, etc., I guess, will have been leased and they won't own the premises in all probability.)

    As for the DTI or BIS as it's currently known, well, here's an extract from their most recent report. "In 2013–14 we wound up 168 companies, disqualified 1,273 directors and obtained 812 restriction orders against bankrupts, as well as making 596 criminal referrals to prosecuting authorities. This reflected sustained funding from ministers for our enforcement activity, recognising its importance for market confidence."
    So they are doing stuff but much of it never gets into the public domain - too boring I expect. (I should flag an "interest" - some many years ago I spent a year on secondment at the DTI's Companies Investigation Branch.) In my view they suffer from not being a prosecuting authority (unlike the FCA for example, which is) so there are too many decision processes by too many organisations I guess and too many cases fall though the gaps.




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  • cafcfan said:

    Chaz Hill said:
    There's some very silly stuff blended in with some truth and huge amounts of irrelevancy within that article. It rather indicates that neither journalists, politicians nor the union reps actually have any understanding at all of how company legislation actually works. Interesting though that they had 53 locations throughout the country. I suspect it was the rent due on those that was the final nail in the coffin.

    Here's an extract from E&Y's Boxing Day press release: "At this stage, no redundancies have been made amongst City Link Limited’s 2,727 employees. However, it is anticipated that there will be substantial redundancies over the coming days, as no buyer has been identified following a sale process for the Company and its business."

    So, the main thread of the mirror article - that the staff have been sacked (by a Tory fat cat) is actually complete fabrication: to date no one at the firm has lost their job. It's coming in all likelihood, just not yet.

    It would seem that the "Tory fat cat" (Jon Moulton) is infact now a Kipper fat cat. Presumably switched his allegiance as leaving the EU would be a faster track to destroying employees rights.
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