'Insolvencies down slightly' - R3
R3, the UK’s insolvency and restructuring trade body, has reported that insolvency related activity has reduced marginally in the South East following a big drop in September.
Regardless of the drop, insolvency related activity is still significantly higher than the same period last year.
The latest figures showed a slight decrease in insolvency-related activities from 219 in September to 211 in October – these include administrator and liquidator appointments together with creditors’ meetings. However, the figure was 164 in October 2022.
R3 has warned that ongoing economic instability is continuing to cause business distress, following its analysis of data about insolvencies and start-ups supplied by business intelligence provider Creditsafe.
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Its findings also revealed the number of firms in liquidation who owed money to their creditors in the South East has significantly increased to 418 – up from 296 in September, a 41 per cent increase, and is now above the year high of 404 in May.
The South East figure is now the second highest for any part of the UK, behind Greater London, which has 564 and regularly tops the chart.
The total number of UK company insolvencies for 2023 rose to 24,955. This number represents a 16% per cent increase compared to the same period in 2022 and a 63 per cent increase compared to 2021.
Garry Lee, chair of R3’s Southern and Thames Valley region, said: “The picture remains uncertain with insolvency trends continuing to be uneven on a month-by-month basis.
“Our unpredictable economic landscape is not good for the smaller business with the vast majority of both creditors voluntary liquidations and compulsory liquidations involving companies with a turnover of less than £1 million per annum.
“It is obvious that current unrelenting economic challenges – growing costs, rising inflation, cautious consumer spending, higher interest rates, increased creditor pressure, requests for higher wages and director fatigue – are continuing to hit businesses hard.''
“Remain vigilant and if you spot warning signs seek professional help immediately. The sooner a problem is diagnosed the more likely it is that a solution can be found.
“If you’re having problems paying wages, staff or suppliers, if stock is starting to pile up, or if you’re worried about your business and its finances, that’s the time to speak to a qualified advisor.”
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