Promotional paper cup manufacturer LogoCups in administration

It was supposed to be one of the latest marketing sensations, but the trend towards advertising on disposable coffee cups has not been strong enough to stop one paper-cup manufacturing company being placed into administration.

CMA Pack & LogoCups.com.au is now in the hands of New South Wales insolvency accounting firm SV Partners, which says it is overseeing a full investigation of the company.

The company is just two years old, having started at the height of a craze in coffee cup advertising. The fad started two years ago in the United States, with giants such as Apple even using it as a way of promotion.

Advertising on coffee cups and mugs is still a popular practice, with some marketing experts saying as late as February that businesses should experiment with it as a type of promotion.

LogoCups was contacted this morning but no representative was available to comment.

The business was advertised for sale in the Australian Financial Review yesterday.

Joe Atkinson, associate director of SV Partners, says the administrators are now investigating how the company collapsed.

“The company does cups and runs for small volumes – local coffee shops and so on. We have appointed administrators at this point, and they are determining the situation right now and will report back to creditors,” Atkinson says.

“We haven’t formed a view at this stage about the company, and we’re endeavouring to find out what happened.”

While SV Partners cannot specify what happened to LogoCups, it says it has already identified a handful of potential buyers.

“We’ve had a great deal of interest,” Atkinson says, declining comment on whether the business can remain sustainable.

“It’s hard when you’re trying to sell businesses in a stretched financial situation – it’s really too early to tell.”