CRUISE Control’s sole director Paul Moore admitted the firm may have over-stretched itself but insisted its business model was essentially sound.
He said a combination of factors led to Monday’s collapse. These included the Sharm el-Sheikh bombings, which hit its Cruise Egypt tour operation, and problems over a £1.8 million credit facility to offset cash-flow problems.
The situation was made worse by marketing commitments, believed to be running at more than £1 million a month, and a commercial dispute with Complete Cruise Solution which barred it from selling its products in September.
“I went as far in trying to save this business as any man can go,” Moore said.
“I was prepared to walk away to save the
creditors, the staff and the business. Cruise Control was one of the most tremendous businesses in the industry.
“We hit a problem which under normal circumstances we would have just hurdled.”
In seven years, Cruise Control grew rapidly, from £9 million turnover to £93 million this year, up from £53 million last year when it made £1.3 million profit. Despite claims it was working on minimal margins Moore said it made between 14% and 16% commission.
He conceded the rapid growth had an effect on customer service and meant he did not have the managerial team in place to run such a large business. Work was underway to improve back-office administration and the firm’s first financial director was appointed eight weeks ago.
Head of sales for Complete Cruise Solution Giles Hawke said there must have been a business reason why potential investors pulled out.
He said: “We have to ensure our customers, our investors and our company are financially protected and work within the terms of ABTA.”