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February UK business insolvencies down

of UK businesses continued to improve, from 81.18 in February 2010 to 81.60 in February this year. The score also saw a small month-on-month improvement from 81.49 in January.

Max Firth, Managing Director of pH, an Experian company, said: "The period of stability for businesses in the UK continues to head in a positive direction overall. However, whilst smaller and larger companies are improving, insolvency rates for the midsized companies (20-100) continue at the same rate month on month. This could mean that in more challenging times they fall victim to being too large to be flexible and too small to rely on a solid, established business structure and long term contracts.

"The continued demise of the food retailing sector is also significant, with the declining financial strength of the industry an indication that smaller independent grocery traders are suffering. Businesses can use insight such as insolvency rates and financial strength as a guide to which sectors and size of businesses may need enhanced risk management so signs of distress aren’t missed."

Other key highlights include:

· Scotland saw the greatest improvement with the lowest insolvency rate at 0.06 per cent in February

· Wales saw the biggest increase to the rate of insolvencies rising to 0.11 per cent from 0.08 per cent in February 2010.

· Yorkshire was the worst performing region with a rate of 0.13 per cent.

· Greater London continued to be the region where businesses had the lowest financial strength score at 80.51.

· The smallest (1-2 employees) and largest (501+) companies, had the lowest rate of insolvencies with 0.06 per cent and 0.09 per cent respectively.

· Companies with 51-100 employees had the lowest financial strength score in February 2011 at 81.59.

· The financial strength of businesses in the Leisure and Hotels rose from 79.09 in February 2009 to 80.05 – the biggest improvement compared to other sectors.

· Food retailers continue to have the lowest score with the financial strength of the industry dropping massively in the last three years from 81.21 in February 2008 to 75.85 that was recorded in February 2011.

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