We are now taking steps to bring the liquidation to a close of which Mike Fortune and Carl Faulds of Portland Business & Financial Solutions were appointed joint liquidators on 5th August 2016.
Prior to the liquidation, the business was initially run as a sole trader business purchasing unwanted stock from major retailers at low costs and selling via mail order and online.
As the business grew it took on an additional members of staff and in February 2014 the director decided to upscale and incorporated a limited company to take over trading. Despite issues with various staff leaving and fluctuation in the market value of the goods during the company’s trading history, trading seemed to be going well. However, in December 2014 the director noticed a significant drop in the resale value of the goods affecting the company’s profitability and causing cashflow issues.
The director was confident that it was only a temporary downturn and continued with efforts to grow the business. The director also arranged for funding in the form of a third party loan to assist in overcoming cashflow issues and to purchase additional stock to increase turnover.
Changing market conditions resulted in tight profit margins and by June 2016 the company was experiencing cashflow issues again. The director ultimately concluded that the business was no longer viable and instructed Portland to assist with placing the company in to creditors’ voluntary liquidation.
As outlined in the first report to creditors, the principal asset in the liquidation was the proceeds of the sale of stock, equipment and motor vehicle prior to our appointment. We confirmed the assets were sold at fair market value and the funds were transferred to the liquidation bank account upon our appointment. We were also pursued and were able to recover a VAT refund due to the company.
We completed our statutory investigation and reported our findings to The Insolvency Services and carried out our other statutory tasks. Unfortunately due to limited realisations during the liquidation, there are insufficient funds to enable a dividend to be paid to creditors.
Creditors are able to find further information in respect of the work undertaken during the liquidation in our final progress report here