Business failure rate edges higher in East
THE rate of business failures in the East of England continued to edge higher last month but the region’s business sector remains one of the most financially robust in the UK, according to information company Experian.
A total of 140 corporate insolvencies were recorded in the East in September, a 26.1% increase compared with the same period a year earlier and well ahead of the 10.7% increase recorded across the UK as a whole.
The rate of business failure in the region (insolvencies as a percentage of the total number of businesses) grew to 0.08%, up from 0.07% the previous month and 0.06% in September last year.
This leaves the region with the joint second-lowest failure rate in the UK, alongside the South East and the East Midlands, and behind Scotland on 0.07%, whereas a year ago the East was in top place.
The region retains third place in Experian’s ranking of overall “financial strength”. Its rating has fallen from 81.94 to 79.91 in September last year, but this figure is still bettered only by the South West (at 81.08 against 82.74 a year ago) and the South East (80.13, down from 82.22).
The very smallest firms, with one or two employees, suffered most in September with the number of insolvencies up by 25.9% compared with the same month last year, while among the biggest companies, those with more than 500 people, insolvencies fell by 26.7%.
Max Firth, managing director of Experian Business Information Services in the UK and Ireland, said: “While larger businesses bucked the trend in September, our analysis underlines how important it is that companies understand the financial strength of their customers, suppliers and business partners.”