The latest insolvency figures for England and Wales show a 17% decrease in all company insolvencies in March 2024 compared with the month prior, yet figures remain much higher than seen during the COVID-19 pandemic.
Oliver Collinge, Director at restructuring and insolvency firm, PKF Littlejohn, says that despite the fall in numbers the corporate failure rate remains unusually high. These statistics and the recent failure of some high-profile businesses like Body Shop and Ted Baker are a reminder that there is still significant uncertainty in the UK economy and many businesses remain vulnerable.
“Although the latest figures show a fall overall, corporate insolvencies remain at a very high level and, whilst high profile casualties tend to grab the headlines, it is worth considering how the climate of economic uncertainty affects SMEs, which make up 99% of all UK businesses. Ongoing supply chain challenges, weak consumer confidence and a consistently high cost of doing business all present real challenges.
“It's critical that businesses act early and seek advice if they are struggling, or if they expect their cash flow to be limited in the coming months. The earlier they act, the more options they will have to secure the long-term survival of their business. This is crucial to enable SMEs, which are at the core of the UK economy, to survive and thrive.”