Third monthly fall in level of North West firms behind with their bills

Research by insolvency and restructuring trade body, R3, shows a third consecutive monthly fall in the number of North West companies behind with their bills.

The figures, based on data from Creditsafe, shows that in May there were 53,831 businesses in the region with overdue bills which they had yet to pay – three per cent lower than in February.

Meanwhile, the number of North West businesses which were, themselves, awaiting payment on outstanding invoices, fell by 3.5% during the same period, to 548,716.

The figures also show that the rate of new business creation in the North West is running ahead of last year.

Between January and May this year, 33,935 new businesses were set up in the region – five per cent higher than in the same period last year.

R3’s North West chair, Fran Henshaw, said: “In a tough economic climate, late payment is yet another problem for businesses to deal with on top of rising inflation and interest rates.

“Therefore, it is good to see some improvement in the situation.

“We would urge all firms to keep on top of their bills as creditors are now taking a tough stance with late payers, and businesses which are, themselves, owed money should tighten up their credit control procedures to protect their cashflow.”

Fran added: “A key trend we have seen in the past year or so has been the rise in the number of businesses voluntarily closing down.

“So it is good to see that the business ‘birth rate’ remains healthy and that new businesses are coming along to help replace them.”

Fran, who is also director and head of corporate recovery and insolvency at chartered accountants and business advisors Beever and Struthers, said: “Given the ongoing challenges, directors need to remain vigilant.”