Business insolvencies increase in the second quarter

August 8, 2012 by · Comments Off on Business insolvencies increase in the second quarter
Filed under: insolvency, Retail 

The trend of high business insolvencies has continued through the first half of 2012. Figures for the second quarter show that insolvencies were up 1.5% compared to the first quarter and up 6% compared to the previous year.

Among the types of business featuring in the list of business failures are equipment supplies, equipment maintenance, design and PR agencies and IT consultancies. These failures are clearly in large part due to the lack of demand from other businesses for their services, owing to the need to cut back in difficult economic times. This is worrying because the enterprises offering business services are supporting those larger concerns that it is hoped will drive the economy back into growth.

The most prominent business sector in trouble is retail. The reduced footfall and the tight grip of shoppers on their purse strings have been widely publicised and the retail sales figures are given prominence in the media each month. The problems in retail are clearly connected with the need for consumers to save more, spend less and reduce the amount of personal debt that has accumulated over many years. Prudent measures that are good for the household are not good news for the retail sector, which is suffering from the decreased demand.

The construction industry is unable to pull out of the slump and has recorded a large number of insolvencies. Cutbacks in public expenditure have led to the postponement or cancellation of a large number of public contracts and the slack cannot yet be taken up by the private sector.

Perhaps more surprisingly the hospitality and tourism industries have also recorded a high rate of insolvencies due to reduced demand. The tourist industry has hit difficulties due to bad weather, less domestic consumer spending on holidays and a reduction in non-Olympic tourism. The only silver lining, which will come too late for many businesses, is the boost expected as a result of the London 2012 Olympics.

Even More Doom & Gloom on the High Street

September 30, 2011 by · Comments Off on Even More Doom & Gloom on the High Street
Filed under: Administration, Retail 

Despite the sunshine, the high street still has some dark clouds hanging over it – in a recent survey by the insolvency trade body, R3, 10% of retailers believe they will enter Administration within a year. This begs the question, should they be calling it a day now rather than facing allegations of trading whilst insolvent in 12 months time? The September quarter day has just passed, so watch this space!

More Doom & Gloom on the High Street

September 14, 2011 by · Comments Off on More Doom & Gloom on the High Street
Filed under: Retail 

The latest figures for AugustĀ from the British Retail Consortium show that, by and large, retailers are continuing to struggle. Food, unsurprisingly held up well, but non-food such furniture and homewares was down on August 2010. Clearly, consumers are continuing to rein in their discretionary spending as worries continue over inflation and the squeeze on personal finances, which some are predicting will continue for a decade!