Business news 16 October 2023

James Salmon, Operations Director.

Insolvencies increase in September. 17% of SME owners are considering selling up. Charity warns of debt timebomb. Economy to avoid recession in 2023 but grow less than expected in 2024.  And more business news that we thought would interest our members.

Insolvencies increase in September

Insolvencies were up 16.5% year-on-year in September, with Insolvency Service data showing that there were 1,967 company insolvencies last month. Of these, 1,576 were voluntary liquidations. This marked a 14% increase on September 2022. In addition, there were 255 compulsory liquidations and 125 administrations.

Despite the year-on-year increase, the number of insolvencies was down slightly on August’s total. Over the three months to the end of September, 6,011 companies were declared insolvent, with this down from a seasonally adjusted total of 6,342 in Q2.

David Kelly, head of insolvency at PwC, said: “While this dip is welcome, we expect the respite to be short-lived, with the UK remaining on track for the highest number of insolvencies since 2009.”

Nicky Fisher, president of the restructuring industry body R3, said: “Businesses are struggling on all sides and from all ends of the supply chain.” She added: “It’s clear that the challenging trading climate is taking its toll on businesses.”

David Hudson, a partner at FRP Advisory, warned: “High levels of insolvencies have become entrenched across the economy after a turbulent 12 months. Unless there’s a rapid and significant improvement in economic conditions, this trend will continue right through the winter and into next year.”

Centre for Economics and Business Research analysis published last month suggests there will be 26,700 insolvencies across 2023.

17% of SME owners are considering selling up

Nearly a fifth of SME owners and decision makers are considering selling their businesses, according to research from Shawbrook Bank.

The study found that 17% of SME owners and decision makers view an exit strategy as a top concern. Among SMEs with a turnover of £100m-500m, 22% prioritise selling up, while 12% of those with lower turnovers aim for growth through acquisition.

Despite the uncertain economic environment, 29% of SMEs experienced growth last year. Over the next 12 months, 18% plan to consolidate their positions, and 17% are considering international expansion. Additionally, 26% of larger SMEs are looking to grow through acquisitions. “While an exit strategy was a ‘top concern’ for 17% of SME decision makers and owners generally, the desire to sell up is more pronounced among the bigger businesses,” Shawbrook said .

Complaints against insurers reach five-year high

Complaints against insurers have reached a five-year high, with a 40% increase compared to last year. The Financial Ombudsman Service (FOS) reported 24,496 new complaints in the first half of this year, with delayed payouts and slow repairs citied among the most common issues. The analysis shows that Admiral, UK Insurance Limited, and Aviva received the most complaints. Overall complaints to the FOS, including those about banks and credit firms, rose by 28% compared to the same period last year, with banking and credit complaints increasing due to a surge in fraud cases

Germany invites UK to improve trade relations
German finance minister Christian Lindner has extended an open invitation to the UK to improve its Brexit trade relations with the EU. Mr Lindner expressed a desire to reduce trade barriers and obstacles in business, saying: “If you want to intensify your trade relationship to the EU, call us.” He suggested that Brexit has created difficulties in daily business life and that the UK is not benefiting from it.

Charity warns of debt timebomb

Debt advisors at StepChange have warned that the debt crisis has become a “ticking timebomb.” With the cost-of-living climbing, the charity has seen a 17% year-on-year increase in people contacting it for support. Earlier this year, StepChange said that over a quarter of its new calls cited the cost-of-living as their main reason for debt, making it the biggest driver of debt among its clients, with council tax and mortgage arrears among the most common concerns.

4 in 10 struggle with rent
Analysis of Office of National Statistics (ONS) data shows that 40% of people are finding it difficult to cover rent payments. This marks an increase on the 30% identified in last year’s report. ONS figures show that average UK rents, excluding London, have risen to £1,278 per month, while in London, the average has hit £2,627.

1 in 3 to cut back on Christmas spending
Almost a third of people are planning to cut back on Christmas presents and food this year, according to a survey commissioned by PwC. The survey found that 80% of those looking to save money blamed increasing bills. The poll shows that one in three adults will start shopping earlier to spread the costs and just 18% plan to spend more this Christmas.

Economy in a better state than a year ago

The governor of the Bank of England says the UK’s economic prospects look better than they did a year ago. Speaking at the International Monetary Fund’s annual meeting, Andrew Bailey said: “From an economic point of view … things really do look better today than they did on this day last year,” adding: “I can say that with some confidence.” He went on to say that there has been “solid progress in terms of showing signs that inflation is being tackled.” But went on to urge caution, saying: “But let’s not get carried away, because there’s an awful lot still to do.” Elsewhere, Chancellor Jeremy Hunt said that while he is “very optimistic about our long-term future … in the short term, we have to recognise that there may be shocks.” He told Sky News: “My approach is to say we will manage those short-term pressures while at the same time building for the long term, doing the things that mean we can be confident we will be a successful and prosperous economy going forward.”

Economy to avoid recession in 2023 but grow less than expected in 2024

The UK economy will grow by less than expected next year as the impact of higher interest rates takes its toll, EY economists have warned. In a new forecast, the EY Item Club has cut its expectations for GDP growth in 2024 from 0.8% to 0.7%. Despite the less optimistic prediction for next year, EY says the UK is on course to avoid a recession this year and has upgraded its forecasts for GDP growth in 2023 from 0.4% to 0.6% after the economy performed better than expected at the beginning of the year. EY said inflation is now expected to fall slightly faster than previously forecast and could reach 4.5% by the end of the year, before hitting the Bank of England’s 2% target in the second half of 2024. Economists do not expect the Bank’s Monetary Policy Committee to increase rates from the current level of 5.25%, and suggest it could start rolling out cuts from May. Meanwhile, Martin Beck, chief economic adviser to the EY Item Club, has sounded the alarm over the impact of oil prices amid the Israel-Hamas conflict. He said: “We’ve seen oil prices rise significantly since the low point back in the summer and there is a risk they could rise higher depending on how the conflict pans out.”

Tech giants may have avoided £2bn in UK tax
Big tech companies including Apple, Microsoft, and Alphabet, may have avoided as much as £2bn in UK tax in 2021 by shifting their profits elsewhere, according to a report by the TaxWatch campaign group. The report estimates that these companies paid £750m in UK corporation tax and digital sales tax, compared to an estimated £2.8bn that would have been due if profits had not been routed elsewhere. There is no suggestion they have evaded taxes illegally. As a lack of transparency in company reports makes it difficult to determine the exact amount of tax paid, TaxWatch estimated how much UK tax these companies would have paid if their UK arms declared profits at the same rate as they declared them worldwide. The report calls on the Government to address this issue and provide more publicly available data on UK corporation tax.

Inflation to continue falling despite energy prices rising
Experts predict that data for September will show that inflation has fallen, with lower food prices helping to soften the impact of higher energy costs. With inflation falling to 6.7% in August, experts expect it to have fallen further to 6.5% in September. While many analysts expect inflation to have dipped in September, Ruth Gregory, deputy chief UK economist at Capital Economics, has predicted a slight increase due to surging energy costs. Also noting the possible impact of a jump in wholesale energy prices, Philip Shaw, chief UK economist at Investec, has warned that “there are certainly upside risks,” some of which “may already be crystallising.”

Workers fear calling out employers on environmental issues

Fear of reprisals are preventing workers from calling out their employers on the climate crisis and other environmental issues, according to a survey from Protect, a charity that defends whistleblowers. The poll found that concern over being fired or victimised at work was one of the main barriers preventing workers from flagging poor behaviour and misleading information about the environment. Employees also pointed to uncertainty about providing proof, while there was also scepticism about whether concerns would be adequately dealt with. Protect launched the survey after seeing a “surprisingly” low number of calls about the environment to its whistleblowing advice hotline. Of those who did contact the charity over environment-related issues, three-quarters said they faced negative treatment as a result. It is noted that while workers can raise concerns directly to the UK’s environmental regulators, between April 2021 and March 2022 the watchdogs only received 38 disclosures. The Competition and Markets Authority, which has new powers to fine companies, invites anonymous tips but is yet to receive any whistleblowing disclosures related to environmental matters.

Finance executives wary of borrowing as interest rates rise

Finance executives at leading British firms are more wary about borrowing than at any time since at least 2007, according to a survey of by Deloitte. The poll found that the gap between CFOs who rated bank borrowing as attractive and those who saw it as unattractive stood at a net -37%, the widest since the survey was launched. CFOs also expressed concerns about high inflation, although business confidence was running at above average levels. The Bank of England has raised rates 14 times in a row, and CFOs expect rate-setters to cut the Bank Rate to 4.75% in a year’s time, from 5.25% now. Ian Stewart, chief economist at Deloitte, commented: “Higher interest rates have flipped a decade-old consensus which was previously in favour of debt finance.” The survey of 70 CFOs included 13 from FTSE 100 firms and 26 from FTSE 250 companies.

Bad management driving workers to quit

Research carried out by the Chartered Management Institute (CMI) shows that almost a third of UK workers have quit a job because of a negative workplace culture. The poll, which highlighted concern about the quality of management, saw 28% of the 2,018 workers questioned say they left a job due to a negative relationship with a manager, while 12% pointed to discrimination or harassment. Among those who said they had an ineffective manager, a third said they were less motivated to do a good job, while around half were considering leaving in the next 12 months. The CMI found that 82% of new managers are “accidental managers,” who have no formal training in management or leadership. Among this group, 15% said they had called out poor behaviour, while among managers who had undergone training, the rate was 25%. Anthony Painter, the CMI’s director of policy, said improving the performance of UK managers is crucial to preventing toxic workplace cultures developing, warning that “this stuff is dragging down businesses, dragging down the economy.”

Bank boss voices concern over geo-political tensions

Jamie Dimon, chief executive of JPMorgan Chase, has told investors that rising geo-political tensions could hurt the economy. Voicing concern that conflicts in the Ukraine and Israel could hit energy costs, food prices, and global trade, he said: “My caution is that we are facing so many uncertainties out there.” He told investors they should be prepared to face higher interest rates and persistent inflation. He added: “This may be the most dangerous time the world has seen in decades.” Elsewhere, Citigroup’s chief financial officer Mark Mason offered similar insight, saying there are concerns about how the wars will affect the economy. “There’s a lot of uncertainty that ultimately gets factored into how things play out,” he warned.

Latest Insolvencies

Appointment of Liquidators – O KANE PROPERTIES LIMITED
Petitions to wind up (Companies) – NEIL RICHARDSON INTERIORS LTD
Appointment of Liquidators – OLIVER & HEWITT LTD
Petitions to wind up (Companies) – JOHN RUSSELL PARTNERSHIP LIMITED
Petitions to wind up (Companies) – MAY & CROWN LIMITED
Petitions to wind up (Companies) – H&M IMPORTS AND EXPORTS LTD
Petitions to wind up (Companies) – SHUA INVESTMENTS LIMITED
Petitions to wind up (Companies) – KOO-EE TRADING LTD
Appointment of Administrator – CARD EXPRESS LIMITED
Appointment of Liquidators – CONDUITY CAPITAL PLC
Petitions to wind up (Companies) – JPS DRIVER HIRE LTD
Petitions to wind up (Companies) – ESSENTIAL PROJECT SOLUTIONS LTD
Appointment of Liquidators – DR KASHKOULI CLINIC LIMITED
Petitions to wind up (Companies) – T & V TRANSPORT DUNGANNON LTD
Petitions to wind up (Companies) – IMS SCOTLAND LTD
Petitions to wind up (Companies) – MARTIN DAWN (CHELTENHAM) LIMITED
Appointment of Liquidators – MARCHMONT VENTURES LTD
Petitions to wind up (Companies) – J. BRYSON LIMITED
Appointment of Liquidators – MARSEILLES COMPANY LIMITED
Petitions to wind up (Companies) – CCG INVESTMENTS LTD
Appointment of Liquidators – ARRESTED DEVELOPMENT LIMITED
Appointment of Liquidators – YELLOW APPLE LIMITED
Appointment of Liquidators – LIGHTLAND LTD
Petitions to wind up (Companies) – E.M.A. SUPPLY LIMITED
Petitions to wind up (Companies) – THE DAPPER MAN LIMITED
Appointment of Liquidators – TREE & COMPANY(1966)LIMITED
Appointment of Liquidators – SME INVESTMENT PARTNERS LIMITED
Appointment of Liquidators – WILLIS PMI GROUP LIMITED
Appointment of Liquidators – POOLHEAD LTD
Appointment of Liquidators – THORNHAM PROPERTIES LIMITED
Petitions to wind up (Companies) – SYNERGY SPS LIMITED
Petitions to wind up (Companies) – EDI MARIA LTD
Appointment of Liquidators – MAVUNO LIMITED
Petitions to wind up (Companies) – CPH PLUMBING & HEATING LTD

Appointment of Liquidators – CAPITAL 1945 LIMITED
Appointment of Administrator – CLAREMONT PEN DEVELOPMENT LTD
Appointment of Administrator – APEX RIDES LIMITED
Appointment of Liquidators – BEE HAYES MARINE LTD
Appointment of Liquidators – BAXTER BUSINESS PSYCHOLOGY LTD
Appointment of Liquidators – WORTH HOLDINGS LIMITED
Petitions to wind up (Companies) – PARAMOUNT M&E LTD
Appointment of Administrator – P N T CONTRACTORS LIMITED
Appointment of Liquidators – RDC CONSULTING LIMITED
Appointment of Liquidators – REDROSA CONSULTING LTD
Appointment of Administrator – CROUCHER NEEDHAM (ESSEX) LLP
Appointment of Liquidators – VAHEY ENGINEERING SERVICES LTD
Appointment of Liquidators – EDENTHORPE PROJECTS LTD
Appointment of Liquidators – PEMROCK LIMITED

Why should you become a CPA member!

The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid, since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for some time to come.

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Just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email today.

When you see your money come in, you will be so glad you used CPA.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections


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Just call  020 8846 0000 and ask for Godfrey Nelson or Cris Shirley (business hours) or email today.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.


Get compensated for previous late payments

Have you been paid late by business customers in the last six years?

Maybe you no longer work with them. Under legislation, you are entitled to  compensation you for those late payments you have suffered.

You put up with the PAIN – now claim the GAIN!

Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!

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Check our compensation calculator to see how much your business could be owed!

Discover NOW the potential value of late payment compensation hidden in your sales ledger!

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.