Australian parcel and courier service Sendle ceased its operations effective January 11, notifying customers via email on that date. The immediate halt to bookings has impacted customers with parcels in transit and those with future scheduled pickups. The company's shutdown follows issues related to a merger last year with two U.S. companies that formed a new entity called FastGroup, which subsequently resolved to wind down.
Cessation of Operations and Immediate Impact
Sendle informed customers on January 11 that all bookings for parcel pickup and delivery were halted immediately. For parcels already picked up and in transit, delivery will occur at the discretion of the delivery partner. Any existing bookings scheduled for pickup on January 12 or later have been canceled. Customers reported difficulties contacting Sendle for assistance regarding in-transit parcels or to recover funds for labels. Small business owners expressed surprise at the sudden cessation of services.
Company Background and Business Model
Sendle, established in 2014 by James Chin Moody, operated as a technology company that connected customers with various logistics providers. The company positioned itself as Australia's first 100% carbon-neutral shipping service. Its business model involved booking shipping jobs in bulk with logistics providers and reselling these slots to customers at a margin, often offering prices below those of Australia Post. For example, a three-kilogram parcel was priced at $13.20 through Sendle compared to $19.30 via Australia Post. Sendle reported shipping over 65 million parcels across three countries, primarily serving small businesses, and claimed to facilitate billions of dollars in sales for retailers. The company gained prominence during the COVID-19 pandemic by providing shipping options for smaller online retailers.
Financial Context and Merger Challenges
Sendle had raised significant private equity investment, including $45 million in a 2021 funding round intended to support its expansion into the United States, and at least $US70 million overall from investors such as Touch Ventures and Federation.
Last year, Federation supported a merger between Sendle and two U.S. companies, ACI Logistix and FirstMile, to form a new California-based entity named FastGroup. Five months following this merger, FastGroup's website became inactive. Investor Federation accused ACI Logistix of providing inaccurate financial information during the merger process and of failing to meet its financial obligations. These issues reportedly strained supplier relationships and adversely affected FastGroup's operating performance. In December, Touch Ventures wrote down its investment in Sendle to "nil." On January 10, the FastGroup board of directors resolved to wind down the company. Federation is reportedly pursuing recovery for its investors, though the quantum and timing of any recoveries remain uncertain. Former Sendle employees and investors have reportedly raised questions regarding the company's trajectory prior to the merger.
Staff Impact
Australian staff were informed of job losses that same weekend. Additionally, approximately 80 call center workers in the Philippines are also facing redundancy. Staff received timely payments and redundancy notices, with call center staff expected to receive entitlements under local law.