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Transport firms rank high on years collapses list

In a year where businesses were squeezed of margins across the economy, transport companies again featured in the ‘Did Not Finish’ roll

 

A number of high profile business collapses made headlines in Australia in 2014, with the transport sector playing host to a disproportionately high share of them.

Independent business news portal SmartCompany has published its list of the 15 biggest corporate failures of the year, with Gregorys Transport, the Roadwise Transport Group, and Australian Entertainment Logistics each making the cut.

Gregorys was both the largest and most recent of the collapses. Receivers were called in just last month, taking control of most of the assets including the company’s road fleet. The company had reportedly missed payments on a number of loans and leases, leading to it being locked out of some of its premises even before the trucks were repossessed.

It was the Supreme Court of NSW that delivered the final, mostly symbolic, blow. On December 1, it accepted an application from the WorkCover Authority of NSW to wind the company up. Liquidator BRI Ferrier is investigating what went wrong, and if any penalties can be recovered from the business owner and sole director Greg Westaway.

Roadwise Transport Group was a smaller business, with an annual turnover of around $10 million. It is understood the company lost a major client in 2013 and was unable to recover the revenue gap in the new year. That loss of income was exacerbated by rising fixed and overhead costs in the transport business.

The company was forced to appoint administrators in May, who were looking to sell the business as a going concern.

Australian Entertainment Logistics had been in business since 2011 when it was placed in administration in October this year.

It specialised in transporting freight associated with entertainment tours around the country but is understood to have been squeezed by competition from non-specialist transport providers.

One of several receivers involved with the Gregorys collapse, Ferrier Hodgson’s Brendan Richards says it’s always disappointing to see transport businesses fall over. As a corporate recovery expert specialising in the logistics sector, he says business conditions are tough, but not insurmountable.

“I know that many of these business failures are completely avoidable,” he said when first assigned to the Gregorys business last month.

“As soon as it becomes evident that a business is in trouble the most important asset is time.

“Businesses that recognise they are in trouble early and work aggressively to combat their problems can often be saved. When they don’t, failure is the inevitable result.”

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