Business insolvency rates drop in Yorkshire
YORKSHIRE has seen one of the biggest drops in business insolvency rates, according to the Business Insolvency Index from Experian.
The global information services company revealed that companies in Yorkshire saw a drop in insolvencies from 0.11% of the Yorkshire business population to 0.09% compared to July last year – making this the eighth month that the region has seen a year-on-year fall.
The overall business insolvency rate fell to 0.08% in July 2013 from 0.09% in July 2012.
This is the third consecutive month that the rate has fallen year-on-year – the first time this has happened since 2010. Although the rate is marginally higher than in June (when 0.07% of the business population failed), the longer term trend shows a steady and continuing decrease in insolvency rates.
Around the UK, many regions performed better than the same month last year. The insolvency rate either dropped or stayed level in nine out of 11 regions compared to July last year.
There were no significant rises amongst smaller companies with up to 100 employees (representing the vast majority of British businesses). Within this group however, businesses with 50-100 employees saw the biggest drop in their insolvency rate from 0.16% in July 2012 to 0.13% in July 2013. Companies with 0-2 employees (representing over 1.5m small companies) experienced a considerable drop in insolvencies; from 0.07% in July 2012 to 0.06% in 2013.
At the other end of the scale there has been another rise in insolvencies amongst the UK’s largest companies (501 plus employees) from 0.08% in 2012 to 0.15% this year.
Max Firth, managing director, Experian Business Information Services, UK&I, said: “A whole quarter of dropping insolvency rates is really positive news, but the fact that larger companies have seen quite a rise shows that we are not out of the woods yet, especially as this can trickle down the supply chain to smaller companies.
“Business owners need to remain vigilant and ensure that they have monitoring systems in place, however simple, to ensure they know the financial status of their customers and their suppliers and are able to act quickly if one of them gets into difficulty.”
