ICSM blasts Farmdrop’s ‘shocking £11million losses’ as anger grows amongst suppliers and customers who say their Christmas’ have been ruined after the firm went bust last week

ICSM blasts Farmdrop’s ‘shocking £11million losses’ as anger grows amongst suppliers and customers who say their Christmas’ have been ruined after the firm went bust last week

Ian Carrotte of ICSM has blasted the directors of defunct firm Farmdrop after it called in administrators and failed to pay suppliers of deliver Christmas turkeys to its 10,000 customers.

“How can a firm like that run up losses of ten million pounds,” he said, “thousands of customers have been left shattered. No turkeys, no vegetables for their Christmas dinner – all paid for in advance with nothing to show for it.”

Trade magazine The Grocer’s Edward Devlin said the company was set up in 2012 by city broker Ben Pugh after he saw a gap in the market for organic farm produce to be delivered to Londoners. Devlin reported: “Farmdrop has made heavy losses since its inception in 2012 - which totalled more than £30m in just the past four years - and has raised more than £30m in funding across several rounds.

“In its latest set of accounts filed at Companies House for the year ended 30 June 2020, the company’s auditor UHY Hacker Young warned the business needed significant funding to continue trading as a going concern.

“Losses at Farmdrop came in at £10m in the year despite revenues more than doubling to £12m as the pandemic drove up demand for its food sourced from local farmers, fishermen and other producers. The accounts stated the company employed around 175 staff in the period, with the wage bill coming in at more than £7m for the year.”

ICSM’s Ian Carrotte said the firm had a long list of directors who must have known the company was heading for the rocks for months. “They simply don’t understand their social responsibilities when you are in business. More than 100 staff made redundant two weeks before Christmas, suppliers left unpaid and customers out of pocket with nothing to show for it. Something was going wrong months ago before Pugh resigned as a director.”

The Guardian reported: “Anxious customers who had been expecting a delivery over the next few days asked on social media what would happen now and if they should attempt to source items from elsewhere. Moira Doyle tweeted: ‘My delivery today is cancelled. Payment taken yesterday for Xmas order. Refund?’ She added that it would be ‘back to Tesco’ for her. Another tweeted: ‘Well @farmdrop have gone bust, and with that, my Christmas food delivery ... anyone got any intel on places still selling goose?’ Jane Tidey was one of those tweeting she had just received an email saying her order for Christmas Eve was cancelled. Meanwhile, Rhiannon Litterick tweeted the company to say her order had not arrived and the phone line was closed. ‘Please help! We’re isolating, so are relying on this order,’ she added.”

And the newspaper also reported on supplier John Malseed of Frenchbeer Farm in Newton Abbot, Devon, who said it was “a bit of a kick in the teeth.” They reported he said there were hundreds of its turkeys in a warehouse in London and “we are trying to get our stock back”. Malseed said he was hopeful he could send them on to the customers who had ordered them, but that it was too early to say for sure what would happen. His farm had more than doubled the number of birds it produced this year, Malseed said, adding: “We will try to fulfil as many of their orders as possible.”

ICSM have reported on the scores of farms and food suppliers who have hit the rocks this autumn in their regular newsletters and listing of who has gone bust including Euro Farm Foods and the Covent Garden Fruit Company.

About ICSM Credit

ICSM Credit has more than four decades of experience as a credit intelligence group whose members gain inside information about firms in trouble allowing them to avoid bad debts and rogue traders. To join costs less than a tank of fuel - while at the moment there's a special free temporary membership offer during the Covid-19 crisis which gives access to free legal letters. ICSM also has an effective debt collecting service which has a global reach - ask for details from Paul.

For details about ICSM Credit call 0844 854 1850 or visit the website www.icsmcredit.com or email Ian at Ian.carrotte@icsmcredit.com on how to subscribe and to join the UK’s credit intelligence network to avoid bad debts and late payers. Follow ICSM Credit on FaceBook, Twitter and YouTube and Ian Carrotte on LinkedIn.

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