Michael Robert Fortune and Carl Derek Faulds were appointed joint liquidators of Quality Plus Finishing Limited on 27th February 2017 by members and creditors.
The company, which began as a partnership, was the idea Michael Haywood who had previously owned and run other companies in the painting industry. The business was formed in 1991 with Mr Haywood’s wife, eldest son and a former colleague. The intention was for the business to fill a gap in the market for high quality work and provide a future for his eldest son who was a highly skilled sprayer by the age of 20. The business was based in Sandy, Bedfordshire and began trading in February 1991.
From 1993 to 2003 the business grew and as a result the business began occupying additional units. Part of this growth was stimulated by a number of large contracts being awarded to the business from national companies. Throughout this period Michael Haywood struggled with his health and Ross took on the management of the business with his brother’s assistance. To manage with the workload the business began running a night shift and increased its employees to a total of 25.
In 2003 the local council, the company’s landlord at the time, asked the business to relocate to enable the development of the current premises. To facilitate the relocation of the business the council built a unit at Gosforth Close, Sandy, for the business to move into.
At this time Michael Haywood and his wife decided to retire. Following their retirement the business was incorporated as Quality Plus Finishing Limited with their sons and former colleague appointed as directors and shareholders of the company.
Unfortunately, in the years following the company’s relocation a number of large contracts were moved overseas and, in an effort to maintain profitability, the number of employees was reduced down to 15.
In 2014 business began to turnaround with a new wet paint project being awarded to the company. At this time the company invested in a state of the art heated spray room for the increasing work. To accommodate this equipment the company rearranged the premises and built a clean and light environment with new IT equipment and software also acquired in an effort to replace the outdated systems.
These new systems and facilities assisted in increasing revenue however, despite revenue increasing on the previous year, profits were significantly less. This has been attributed to the increase in raw material prices with some of the company’s largest clients not accepting the price increases. In addition, a number of bad debts suffered by the company also had an impact on the level of profit achieved.
The company’s clients continued to move work overseas and throughout 2016 the work being undertaken by the company continued to reduce. The company began incurring a monthly loss and, in an effort to manage this, a number of employees left the company and were not replaced.
The directors identified that as a result of the bad debts being incurred together with a reduction in work being completed and a proportion of that work being unprofitable, the company’s outlook was bleak. The directors subsequently liaised with a number of the company’s largest customers and one of which assisted in seeking an investor for the company. The directors were introduced to Portland during a meeting with the potential investor at which Portland were present and following the withdrawal of the investor the directors liaised further with Portland to consider the company’s financial position. At this time the company was also liaising with a customer who was interested in acquiring the assets of the company. These discussions were ongoing however the directors concluded that the business could not continue for an extended period whilst negotiations were being finalised and it would be for a liquidator to agree any potential sale of the business.
The directors formally instructed Portland to assist in taking steps to place the company into voluntary liquidation on 14th February 2017 and notice of the liquidation meetings were sent to creditors on 15th February 2017. It was decided that the company continue to trade up to 24th February 2017 to finish outstanding work which would ultimately better the position of creditors.
The joint liquidator’s full report can accessed here