North West region leads fall in rate of business insolvencies
Analysis released today from Experian, the global information services company, reveals positive news as the overall business insolvency rate for the first six months of the year fell to 0.44 per cent from 0.47% in 2013.
This was led by businesses in the North West region which saw the biggest turnaround since last year. During January to June, 0.46% of the business population in the North West of England failed compared to 0.56% of the business population in 2013.
There were only two areas that experienced an increase in business failures. Scotland saw a significant increase in insolvencies from 0.18% in H1 2013 to 0.28% in H1 2014. The South East of England also saw a minor increase, from 0.41% to 0.42%.
Looking at insolvencies by company size showed an overall positive picture with all performing well in H1. Only the smallest companies with 1-2 employees did not experience a fall in insolvencies as their rate remained flat at 0.32%. Companies with 100-500 employees saw the biggest improvement with their insolvency rate going from 0.72% to 0.51% in June 2013.
Max Firth, managing director, Experian Business Information Services, UK&I said: “The fall in insolvencies is in line with the more positive economic backdrop. Improving business confidence and rising market demand is underpinning a greater willingness among firms to employ more people, which is good news across the UK.
“It is particularly interesting that the North West, which has seen general improvement in the economic backdrop in line with the UK as a whole, has seen better than average improvement in the insolvency rate.
“Insolvencies among the UK’s smallest firms – one and two man bands – did not worsen, but did not improve either. A key component to surviving as a small business is to keep an eye on the fortunes of their biggest customers and key suppliers. If either of these go out of business then the impact will reach them too.”