Wholesaler Palmer & Harvey has entered administration with the loss of 2,500 jobs.

More than two-thirds of the 3,400-strong workforce were made redundant yesterday at the firm’s Brighton head office and across the company’s 14 regional distribution centres, which supply up to 12,000 product lines.

Described as the UK’s largest delivered wholesaler to the UK convenience market, the business has 90,000 customers ranging from small c-stores to national supermarket chains.

Administrator PwC said the group had been by hit by challenging trading conditions in recent months and that efforts to restructure the business had been unsuccessful.

PwC added that this resulted in cash flow pressures, and that it had not been possible to secure additional funding to support the business. Earlier this year, P&H axed its direct-to-store baked goods sales service Bakedirect.

The company’s remaining employees will assist the administrators in managing the closure of the business. Currently, 450 employees have been retained within the wholesale operation.

“The P&H Group has faced a challenging trading environment, and the need for significant restructuring has been recognised for some while,” said joint administrator Matthew Callaghan.

“The company has insufficient cash resources to continue to trade beyond the short term and the directors have concluded that there is no longer any reasonable prospect of a sale. Therefore, the directors have had no choice but to appoint administrators.”

He added that the Palmer & Harvey name has been a trusted partner for retailers and suppliers for nearly 100 years.

“The administration team will focus on working with employees, clients and suppliers to facilitate a smooth and effective wind-down or transfer of operations over the next few weeks.”

PwC is continuing to explore options for the sale of P&H subsidiaries - P&H Direct Van Sales Limited, P&H Sweetdirect Limited and P&H Snacksdirect Limited.

WS Retail Limited has not been placed into administration and continues to trade as normal.