Fone Logistics hit as dealer goes bust

Fone Logistics hit as dealer goes bust

Fone Logistics is seeking legal advice after mobile phone dealer Marmalade ?went into administration last month.

It left the distributor liable for an estimated £400,000 of clawbacks ?from 3 for failed connections made by the Manchester based dealer.

Marmalade was one of a number of dealers used by Fone Logistics to sell b2b connections for 3. Just this summer, Fone Logistics boasted a record number of 3 connections, smashing connection targets by 280% over eight months ?to October 2008.

However, a high number of failed connections has resulted in 3 clawing back an estimated £500,000 in commissions from Fone Logistics. At least £400,000 of clawbacks came from failed connections made by Marmalade, said sources.

Fone Logistics chief executive Ian Gillespie told Mobile: ‘Marmalade has gone into administration. We are taking legal advice and cannot comment further on that.’

Companies House confirmed it is in the process of striking off Marmalade following the company’s failure to file accounts since June last year.

Gillespie confirmed that Marmalade’s failure had left Fone Logistics to pick up the tab. He said: ‘The clawback is nearly all from Marmalade. Our returns are very much what 3 wants within the guidelines of selling over the phone. However, the percentages on Marmalade are well out.’

Fone Logistics met with 3’s new sales director, Amanda Lambert, last week. Gillespie said at the time that Fone Logistics wanted reassurances of 3’s commitment to its b2b deal after the operator pulled its b2c business in house.

Gillespie said its business relations with 3 are still strong, and the network is keen to grow its b2b business with Fone Logistics. He added: ‘It was a very constructive meeting with 3 and out of that came action points for both parties to take away and look at.’

A spokesman for administrators PKF in Manchester said: ‘Marmalade is insolvent. We have convened a meeting of creditors on 6 October with a view to the firm going into creditors’ voluntary liquidation.’

3 responds
3 said: ‘3 Business only claws back in extreme cases to protect against those wishing to leave during their cooling-off period, or from fraud and bad debts. In these situations, it is policy to reclaim a set amount for each connection and this case is no different, with Fone Logistics already having honoured their claw back payment. We see Fone Logistics as an important partner for 3 Business moving forward, and continue to work closely with them to develop all available channels.

‘This policy ensures us a good quality of Business customer, at the same time as encouraging dealers to sell 3 Business in a way that will guarantee a long and productive relationship with customers. For this reason, 3 Business is fully supportive of new rules to make sure dealers are operating in a transparent manner as they help to ensure the longevity of our relationship with customers, at the same time as reducing clawback.’

Written by Mobile Today
Mobile Today

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