The fine margins of survival

The shocking and sad demise of Tuffnells brings back bad memories of 2014, when City Link closed its doors on Christmas Eve that year.

Steve Hobson Editor Motor Transport

Express parcels and the ‘ugly’ freight that Tuffnells specialised in are both incredibly hard to make money from. It is of course not impossible, as DPD proves all too well, but get it wrong and the losses can mount very quickly.

I remember being told 15 years ago by the then CEO of Nightfreight, which was later taken over by DX, how easy it was to slip from a small profit to large losses. He described the Nightfreight operation as a complicated machine controlled by a set of valves that had to be constantly adjusted to keep the operation running smoothly. Get one valve just slightly out of adjustment and the losses quickly mounted.

City Link and Target were culturally miles apart, with the corporate City Link trying to bring order to a decentralised and very entrepreneurial Target Express. Just like the complicated control panel described by the Nightfreight CEO, getting the balance right between the central control needed to run safely and legally and allowing local managers the commercial freedom to win new business can be very difficult.

Tuffnells was acquired by Connect Group, owner of Smiths News, in 2014, and the parent set about bringing order to a business well known for its aggressive entrepreneurial approach to the IDW market. There was always a danger that this culture clash would put the control valves well out of kilter.

In 2020, Connect elected to sell Tuffnells for £15m – a fraction of the £130m it paid six years earlier – and three years later the business closed its doors.