New start with Gummistrada after T.T.I. insolvency

Just as too many cooks spoil the proverbial broth, multiple stakeholders can sometimes be problematic in the business world. Peter-Alexander van ‘t Hof tasted this particular broth a few months ago and found it bitter and unpalatable. Yet he isn’t letting this ruin his appetite for the tyre industry.

We recently caught up with van ‘t Hof in his home town near Rotterdam, and he told us the tale of Tyre Trading International (T.T.I.), a wholesaler visited on previous trips to the region. But popping into the T.T.I. offices in Numansdorp wasn’t an option this time around, as the Court of Rotterdam (Rechtbank Rotterdam) declared the company insolvent on 21 June 2022. This development came as something of a surprise, not least for Peter-Alexander.

Confirming the demise of T.T.I. – the wholesaler closed its doors for the last time on 10 August – van ‘t Hof explains that the insolvency followed a family feud amongst minority company shareholders. No names were named for obvious reasons, but as background information he tells us that one of T.T.I.’s suppliers took a shareholding in the company when father Peter van ‘t Hof retired from the business. “He was our largest supplier and a very good supplier over many years,” comments Peter-Alexander. “Everything went well until the problems with Twen-Tyre began.”

T.T.I. took a majority shareholding in Van Aalderen Twen-Tyre B.V. at the start of 2017, the acquisition giving the wholesaler a presence closer to the Dutch-German border and the expectation of “greater buying power” and “an even larger product range.” By mid-2018 the wholesaler could report that Twen-Tyre’s turnover had grown by more than 50 per cent since gaining new ownership, but some 18 months later it announced plans to close the Twen-Tyre site in Amelo. Peter-Alexander commented in January 2020 that a reorganisation of Twen-Tyre – purchased by T.T.I. after its bank “decided to stop financing” – initially yielded good results. But pre-existing problems kept Twen-Tyre stagnating in the red in the latter part of 2018 and 2019, and van ‘t Hof closed the business in March 2020.

“We exited Twen-Tyre three weeks before the pandemic began,” he adds. “First we had Twen-Tyre, then came Covid, then freight costs began to rise. And now this – one thing after the other. We couldn’t help the other factors, but Twen-Tyre was a mistake.”

T.T.I. enters insolvency

Peter-Alexander was unaware of this at the time, but T.T.I.’s supplier investor had brought his nephew in as an investor too, and this individual was very disappointed that the monies invested in Twen-Tyre were gone. “He more or less said ‘if I get nothing, then you get nothing either’ – and simply applied for insolvency without saying a word to me first.”

While Dutch law allows minority shareholders to undertake such a step, van ‘t Hof stresses that there was “no need for the business to become insolvent” and related that he offered to sit down with the shareholders and their lawyers and “determine exactly what such a conflict would really mean for everyone.” His former partners declined this proposal, and no mediation sessions or other measures were attempted before the court approved the insolvency application.

Although appealing the decision is theoretically possible, the appeal process takes an entire month. “And when we cannot conduct any business and generate any turnover over a period of four weeks, we go broke anyway. The costs don’t stop during that time.”

Tyres at the heart of new portfolio

After delivering all ordered goods, T.T.I. stopped trading and 25 employees lost their jobs. Peter-Alexander reports that 20 of these have found new employment elsewhere while the remaining five remain at the Numansdorp site – more on this later. His involvement in the tyre business continues in a number of areas, including a new venture.

This venture is Gummistrada, a business that Peter-Alexander van ‘t Hof previously held a share in but now owns in its entirety. Quipping that having no business partners is a “good thing” he tells us that tyres will be an important element of Gummistrada, along with other selected automotive products and services.

Peter-Alexander purchased T.T.I.’s inventory of classic and vintage car tyres from the insolvency administrator and will sell these through Gummistrada – he shares that he’s already received “six or seven serious offers” from established industry contacts regarding these products. Two-wheeler tyres is another former T.T.I. product segment that the business is looking to pick up, and van ‘t Hof also has experience with other specialties, such as semi-slicks. Other products will likely join the Gummistrada portfolio, and we’ll know more about this by the end of the year.

At any rate, he is confident that he can utilise his “good customer network” in the Benelux region, France and Germany. Post-Brexit UK is a trickier proposition despite established contacts in our market, but Peter-Alexander visited the UK in mid-September and has of late has investigated the ins and outs of exporting. “I wanted to know for sure if it is still possible for me, and it is. But a thorough understanding of how everything works is crucial.”

Outsourced distribution

After a quarter-century with T.T.I., Peter-Alexander van ‘t Hof appreciates the opportunity to “try new ways of doing things” and is in no hurry to bind himself to large-scale projects. The former T.T.I. facility in Numansdorp has been rented to Sail Line Global Logistics, a company handling 300,000 containers for the tyre industry each year. Sail Line has taken a ten-year lease on the facility and Peter-Alexander has the option of leasing back a portion of the premises. He will support the company’s logistics and commercial business on a freelance basis. A potential role for the Numansdorp site is the order picking of new containers to provide the correct mix for customers.