The plight of Scotch Frost of Glasgow Limited, which collapsed into administration with the lack of all 17 jobs within the closing weeks of final yr, is printed in an directors’ report.
The agency that equipped recent and frozen meals to restaurants and retailers all through the UK ran into the purple in its closing months, making a web lack of £3.6m on turnover of £25.6m.
The agency went into administration after a petition to Hamilton Sheriff Court by its administrators and Kevin Mapstone and Paul Webber of BTG had been appointed joint administrators.
Based in Bothwell Park Industrial Estate close to Uddingston, the company had a 33,000-square-foot warehouse and head workplace which has now been offered in a deal value £2.5m.
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The directors stated of their report: “Over the final three years, the enterprise providing has shrunk because the market on this business has develop into very worth pushed with the core prospects being extra worth centered.
“The business had modified and was now simply accessible with decrease boundaries of entry which led to new rivals out there.
“This had the effect of lowering the prices and thus making it extremely difficult to support the company’s relatively fixed overheads.”
Declining income
They stated that “with declining revenue, the business was focused on reducing the overheads wherever possible”.
The administrators additionally stated: “The primary space was round staffing, which the company significantly decreased. This meant that these workers remaining, had been required to help in different areas of the enterprise. The workforce regularly decreased to 17.
“More recently, the sites at Newcastle and Harlow were moved out of the company’s name in an effort to reduce costs and the company centred the business and operational activities at the main site in Glasgow.”
Industry pressures
The administration displays pressures within the provide chain of the hard-pressed hospitality business.
BTG stated the agency was hit by decreased gross sales “due to customers closing down and reducing number of trading days”.
There had been “reduced operational costs for core customers” and “fierce competition resulting in reduced margins”.
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Another vital issue which could possibly be addressed at Westminster stage was the company’s larger workers prices “due to recent National Insurance increase”.
In the replace, BTG stated £1.6m was repaid in full to secured creditor Japan Food Express and HMRC has submitted a declare for £213,000.
Drax, the company’s vitality supplier, was paid almost £70,000 and British Gas was paid £3,400, whereas Business Stream water service supplier was paid £5,300.
Unsecured collectors
Claims of unsecured creditors had been estimated at £7.8m, whereas, so far, claims totalling £5m had been lodged.
BTG stated: “Based on current information, it is unlikely a dividend will be available to the unsecured creditors.”
The directors stated: “The company was integrated on October 26, 1967 and was based by the Louden household.
“The business operated as an ethnic food distributor covering fresh, frozen and ambient produce.”
Thomas McKay, BTG managing associate, stated earlier that “this is a sad day”, including “but after consultation with the firm’s secured creditor in Japan the directors had no viable way to continue trading”.
