British Typhoo tea firm collapses into administration putting more than 100 jobs at risk

Iconic British tea brand, Typhoo has entered administration, placing its future in jeopardy. The company, celebrated as one of the UK's oldest tea firms, lodged an insolvency notice last Wednesday after a tense two weeks attempting to gather creditor support to repay its debts.

Kroll, a risk and financial advisory outfit, has been assigned to steer the proceedings. This development puts more than 100 jobs at risk.

Typhoo shared a recent update explaining their predicament: "The company has experienced significant cash flow constraints as a result of supply chain disruptions and subsequent service issues. The company has been exploring a sale of the business and assets, which is in the process of concluding. The administration process provides Typhoo Tea with protection, allowing the Joint Administrators to finalise the sale in order to rescue the business."

John Sumner, a Birmingham grocer, launched the tea enterprise in 1903, leading to its rise as a top tea label in Britain. In recent times, however, the public's changing tastes, with a shift towards coffee, have seen Typhoo's revenues fall.

Despite the search for a new proprietor, Typhoo will maintain its present operations and products will remain on shop shelves, reports the Mirror.

Renowned for the catchy phrase "you only get an oo with Typhoo" and high-profile endorsements by celebrities like Nigella Lawson, Ben Fogle, and the beloved late Cilla Black, Typhoo has cemented itself as a household name.

Typhoo has reported a significant loss of £38 million last year, with sales dropping by a quarter to £25.3 million, despite employing 116 staff as of late 2023. The tea brand also faced challenges when trespassers broke into its former Merseyside factory, causing "extensive damage" and rendering the site "inaccessible."

The incident led to Typhoo incurring £24 million in exceptional costs for the 2023 financial year, largely due to the damage.

Although the company was in the process of selling the factory, which it successfully did in June 2024, its debts increased from £53 million to £73 million at the end of September 2023. Since 2021, Zetland Capital has been the majority shareholder of Typhoo, which appointed Dave McNulty, the ex-head of Burts crisps, as its new CEO in October.

Alongside this change, Typhoo launched an overhaul of its supply chain aimed at combating sexual violence against women on tea plantations in East Africa, reducing its number of suppliers in the region from 300 to just three.