Administrations increased by 15 per cent in South West over last year
The number of South West companies falling into administration jumped by 15 per cent in 2023, according to figures from Interpath Advisory.
Analysis of notices in The Gazette by Interpath also shows that there were116 administrations seen in 2023 across the South West a 15% increase from 101 cases in 2022. The most impacted sectors were retail (19 cases), building & construction (16 cases) and industrial manufacturing (14 cases).
However, the region tracked below the overall national trend with administrations rising 25% over 2023 to 1,307, up from 1,049 in 2022 as sluggish growth, persistent high interest rates, and fragile consumer sentiment continued to impact British businesses.
Lee Swinerd, head of Interpath Advisory’s Bristol team, said: “The number of administrations continues to rise as the financial challenges of recent years take their toll on businesses. For many South West companies, 2023 was difficult, despite signs towards the latter end of the year that some of the prevailing economic headwinds might be starting to lessen. We’ve seen a steady and incremental uplift of insolvency activity over the course of the past 12 months and the start of 2024 hasn’t provided much cheer for management teams in the region.”
Looking ahead to the outlook for the rest of 2024, Lee Swinerd concluded: “With the confirmation that the UK has tipped into recession, the outlook for businesses remains precarious. But it’s not all doom and gloom out there. Inflation is proving sticky but didn’t rise as many had expected, we have a resilient domestic labour market and there’s a lot of liquidity in the debt market, which means borrowers continue to have plenty of options. Nevertheless, 2024 will likely remain a period of elevated interest rates by historic standards, and weak consumer confidence will continue to impact those sectors already feeling the pinch.
“To navigate this, South West businesses should look to recognise warning signs and cash pinch points early, and seek appropriate advice. The more time that is available to deal with the issues at hand, the more options and levers are available to pull.”
