The latest insolvency statistics for England and Wales have revealed a 10% increase in business dissolutions from the same quarter last year, reaching their highest numbers since Q2 2009 – the calendar year that saw the sharpest fall in GDP since official records began in 1949.
Brendan Clarkson, Business Advisory Director, at restructuring and insolvency firm, PKF GM, says that insufficient help from the Government and continued inflation have had devastating impacts on businesses’ bottom lines. He says that business owners who think they may be struggling should reach out for support as soon as possible.
“The evidential tsunami of insolvencies is now becoming a reality,” says Brendan, “and there is no doubt that continued high inflation coupled with a lack of support from the Government since its own bailout post-Covid has led us to where we are.
“The unfortunate fact is that businesses are being hit from a variety of angles – and all these blows have an effect on bottom lines. Firms are operating in a climate where consumers are reducing their spending on non-essential items, while at the same time, the costs of operating a business remain high. Inflation has been a problem for some time, and while this is expected to ease, it is still sitting higher than many have predicted.
“Our message to company directors is straightforward: if you are at all worried about your business, seek advice.
“It is a difficult conversation to have, let alone to start, but the earlier you begin dealing with any issues, the more options you will have available and more time to make decisions while concerns are new, rather than when they have spiralled.”