| Business insolvencies down by 30% |
By: Rebecca Hubbard
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Posted: Wednesday, August 18, 2010 2:49 pm
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The number of failed UK businesses dropped 33% in July this year, compared to the 2,312 insolvencies recorded in the same month last year, according to statistics from Experian, the UK's largest credit reference agency.
The latest results therefore equate to an insolvency rate of 0.08% of the business population in July 2009, compared with 0.12% the year before.
The highest rate of insolvencies was seen in Greater London, with 402 businesses failing last month. Despite this being an improvement on 2009's figure of 570, the region continues to have the worst financial strength for businesses, with an average score of 79.75. The region with the fewest collapses was reported to be the North East with 35 for the month, again an improvement on July 2009's 69.
The overall financial strength score of UK businesses in July was also marginally higher than last year; 80.93 compared to 80.61. The current score of 80.93 was even slightly ahead of the 80.83 high recorded in June 2010, however it remains down on the 12 month high of 81.37 reported in December 2009.
All businesses with employee numbers below 501 reported a year-on-year fall in insolvencies. The biggest improvements were to be seen in those firms who employed 101-500 members of staff, which reported 56% fewer insolvencies than July 2009. Those companies that did employ 501 or more staff were the only size business to see an increase in insolvencies - moving from 0.11% to 0.17% between July of last year and July of this year.
Managing principal of pH (an Experian company), Max Firth, said: "July's data indicates that the SME population is faring much better in terms of insolvencies than it did this time last year. However, increasing failures at the top end of the market demonstrates clearly that there is a still a great deal of uncertainty. Given this ever changing picture, it is vital that organisations ensure they understand and proactively manage the risk that those they do business with exposes them to." |
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