Withdrawal from Europe
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• After a disastrous six months, Interlink Express has abandoned its European operations at a cost of more than VI million.
The Express parcels and distribution company launched its German operation last May but quickly ran into difficulties, and by the end of June was predicting heavy trading losses (CM 6-12 July).
Last week the decision was taken to cease trading in Germany and France after local franchisees refused to adopt revised operating methods.
We asked franchisees to relinquish their old Interlink agreements for new European market contracts. But only 60% supported the agreement," says Interlink chairman Richard Gabriel. "This was very disappointing as growth figures were still climbing despite recent 180% price increases, and we had reduced monthly losses from 200,000 to £100,000."
He admits the withdrawal from Europe has left Interlink "in a quandary", but the company is determined to move back into Europe.
Interlink is now faced with three European alternatives, says Gabriel. Firstly, the company could set up a similar operation, but on a smaller scale. Secondly, the firm could develop a reciprocal trading arrangement with another European firm "but this would not give Interlink the element of control it would like," says Gabriel. Finally, the company could buy an existing small operator; several firms have already contacted Interlink since its European withdrawal.