The changing face of insolvency, according to Wilson Field

PHIL Meekin of Wilson Field wasn’t always in the insolvency game.

After spending a large part of his working life as a bank manager, Mr Meekin went on to own a cleaning business and an Italian restaurant – so unusually, has seen both sides of the fence.

Mr Meekin said that the reason why so many firms don’t come to a turnaround firm in time is “eternal optimism”. They see it as a last resort rather than a way to help them in the right direction before they dig themselves a bigger hole.

Insolvency practice Wilson Field is taking a fresh look at attitudes to insolvency, emphasising the turnaround business rather than insolvencies.

Wilson Field seems to have moved a bit differently from the crowd, growing organically rather than buying other firms up, and now they have turned their unique experience to capitalise on an increasingly buoyant market.

In Yorkshire and Humberside and the North East just 4% of businesses are experiencing decreased profits, 17% are experiencing falling sales volumes, 4% are seeing market share fall, and 7% are regularly using their maximum overdraft.

With only 24% of UK businesses reporting a key indicator of distress, changing your approach to insolvency can’t hurt.

“In an ideal world,” Mr Meekin said, “we could go directly to the owners and directors of a business and they would already be aware of the issues and willing to make changes. There are two extremes in insolvency cases. In the first, directors come to us early and get us to help identify problems which could prove fatal. This is obviously the ideal scenario.

“The other extreme is where bailiffs are at the firm’s locked doors, and once it has started to go wrong, it goes wrong very quickly. and a chain effect would mean that supply chain firms and customers might also end up in similar situations.”

The 2011 Legal Services Act was a double-edged sword, said Mr Meekin, as although a firm ends up as “a business rather than a practice” it also means that the business world can help change the image and workings of the legal sector.

Mr Meekin said: “These business people taking over law firms bring in technical knowledge that a lawyer, however proficient, may not have. There is a definite skills gap, we as a sector aren’t good at marketing ourselves.” The red tape and privacy issues surrounding the law are obviously a factor but so is the nature of the beast.

The number of companies going into insolvency has gone down to pre-2007 levels, says Mr Meekin, which means the niche sector has to adapt. “Now that we are out of the recession and people are better educated, there’s more information out there. County court judgements mean that cases like that aren’t getting as far as court. There are a lot of firms chasing a lot less work because of this.”

But Wilson Field is adapting to the changing landscape. Relabelling and turning towards turnaround rather than insolvency means that firms can be caught earlier on, with more positive outcomes.

“We don’t want a situation where we have to lock up and throw away the key any more than anyone at the business in question does. More businesses growing and launching helps GDP growth, but we do live in a competitive environment, and if firms are poorly managed and don’t get the help they need early, they might not last. That could be any one of us, and we’re not here to judge anyone.”