The latest Business Insolvency Index from information services company Experian today revealed the number of business insolvencies in August remained stable.
Throughout last month, 1,723 companies (0.09 per cent of the business population) failed – the same rate as in July 2012 – and similar to the August 2011 figures when 0.08 per cent (or 1,563 companies) failed.
Small and medium-sized firms showed the biggest improvement: in the 26-50 employee bracket there was a change from 0.21 per cent in August last year to 0.15 per cent this August – their lowest insolvency rate since December 2007. Continuing the positive trend shown in July, firms in the 11-25 employee bracket also did well – down from 0.21 per cent last August to 0.08 per cent this year.
Max Firth, managing director, Experian Business Information Services, UK&I, said: “Since March we’ve seen insolvency rates flatten out, which is a positive and welcome trend. In addition, we’ve seen real pockets of improvement, such as in Scotland and Yorkshire, which have been sustained over a number of months now.
“Companies need to continue sensible financial practices such as risk planning and monitoring their financial health and those of their customers and suppliers.”
Building on their improvement since January this year, Scottish firms continued to do well last month, with an insolvency rate of 0.06 per cent compared to 0.09 per cent in August 2011. This represented a slight increase on its lowest ever figure in July, but was still the most improved out of the regions in August compared to a year ago.
The picture in Yorkshire was also relatively good compared to the rest of the UK – with a fall in its insolvency rate from 0.10 per cent in August last year down to 0.08 per cent in August 2012. It also saw a fall from this July’s figure of 0.11 per cent – the biggest month-on-month drop of all UK regions.