Increase in North West firms in ‘significant financial distress’
New figures today reveal a 3% leap in the number of North West businesses suffering significant financial distress at the end of 2018.
The latest Red Flag Alert data from insolvency experts Begbies Traynor, which monitors the financial health of companies across the North West, says that 46,477 businesses ended the fourth quarter of 2018 in significant distress, up by 1,393 from the previous quarter (45,084).
The sector hardest hit during the run up to Christmas was industrial, transportation and logistics which saw an 8% increase (taking the total number to 1,180) on the previous quarter.
The financial services sector and the real estate and property sector both saw a 7% increase in the number of firms in distress (938 and 4,465 in total).
Low levels of Christmas trading impacted the high street with retailers suffering a 4% rise in distress levels, taking the number of troubled retailers in the region to 3,228.
The sectors with the highest volume of companies in significant distress were support services (12,536) and construction (6,090).
Gary Lee, partner at Begbies Traynor in Manchester, said: “Carnage on the high street was probably the highest profile story at the end of 2018 and across our region we have certainly not been immune to this.
“It’s not all about the high street, though, and sectors such as property and construction faced severe challenges.
“The figures relating to the property and construction sectors are proof that businesses are facing a squeeze, despite visible evidence of new developments springing up in our towns and cities.
“The final quarter of trading before Brexit happens is now a key period for companies.
“2019 will be another year of change and uncertainty and company directors, whatever sector they operate in, will see it as a true test of their business acumen.”
