Business news 31 December 2025

UK businesses are heading into 2026 with growth expected to stay weak and consumers increasingly pessimistic about the economy. That combination typically means tighter household spending, slower sales cycles, and more pressure on cash flow — exactly the conditions in which late payment and bad debt tend to rise. Alongside that, HMRC is gearing up for tougher enforcement, and several high-profile insolvency risks highlight why credit checks and ongoing monitoring matter.

James Salmon, Operations Director.

Economic stories

Experts predict sluggish growth ahead in 2026

Economists expect 2026 to be another soft year for UK growth, with limited policy momentum aimed at stimulating private sector expansion. 2025 pressures included tax rises and the knock-on impact of US tariffs, while inflation reportedly rose to 4.9% by October, driven largely by food costs. Unemployment reached 5.1% — the highest in nearly a decade — as firms trimmed headcount in response to wage costs and the adoption of AI.
Why it matters (selling on credit): Slower growth and rising costs usually increase late payment risk, so tighter credit control and monitoring become more important going into 2026.

Brits brace for an economic downturn (KPMG)

A KPMG survey suggests sentiment has weakened sharply, with nearly 60% of respondents saying the economy is deteriorating, up from 43% earlier this year. Grocery prices remain the biggest concern (81% cited rising food costs). Forecasters expect subdued growth to continue, with Capital Economics projecting 1.4% growth in 2025 easing to 1% in 2026.
Why it matters (selling on credit): When consumers feel squeezed, spending slows and invoices get paid later — increasing cash-flow strain for businesses trading on terms.

Tax & Government

Tax enforcement set to surge in 2026

HMRC is expected to take a more proactive enforcement stance in 2026, backed by plans to invest an additional £555m per year to boost compliance capacity and technology, aiming to raise £5.1bn annually by the end of the Parliament. Recruitment of 5,000 new compliance officers by 2029/30 is also planned, and advisers expect an uptick in formal enforcement actions.
Why it matters (selling on credit): More HMRC activity makes clean records and predictable cash flow vital — and late-paying customers can quickly push you into tax stress.

Making Tax Digital criticised as “ill considered”

A retired accountant has criticised Making Tax Digital (MTD), warning it replaces a straightforward annual self-assessment process with up to six submissions a year. The concern is that many taxpayers are unaware of the change and will struggle with mandated HMRC-approved software. Critics argue it will add admin, raise costs, and overload HMRC with additional filings.
Why it matters (selling on credit): Extra compliance admin and software costs can tighten working capital — and some customers may “manage” cash by stretching payment terms.

SME-focused stories

Businesses prioritise AI training over technology spend

A Lloyds Bank survey suggests many firms want the productivity upside of AI in 2026, but are prioritising people over platforms: 35% plan to increase training budgets, while 33% expect to invest directly in AI. This focus comes alongside Rachel Reeves’ £1.5bn skills package aimed at easing shortages in digital and AI roles.
Why it matters (selling on credit): Training spend can delay short-term returns, which can tempt businesses to preserve cash by paying suppliers later unless terms are enforced.

Scottish manufacturers brace for a 2026 M&A wave

FRP’s Manufacturing Agenda report suggests M&A is likely to pick up in 2026, with nearly a third of senior decision-makers expecting buy-side or sell-side activity within the next year. Firms are also prioritising digital capability upgrades and succession planning amid ongoing geopolitical and operating risks.
Why it matters (selling on credit): M&A can change payment behaviour overnight — review credit limits and terms when customers restructure or change ownership.

Industry-specific stories

LK Bennett faces second collapse in six years

LK Bennett has filed for administration, potentially its second collapse since 2019. The retailer employs around 280 people and is currently backed by Chinese owners. Latest accounts showed a £3.2m loss and borrowings of nearly £22m, with auditors warning about going-concern uncertainty and possible covenant breaches.
Why it matters (selling on credit): Well-known brands can still fail quickly — watch for covenant warnings, rising borrowing and deteriorating accounts before extending exposure.

Jhoots Chemist faces insolvency threat

Pharmacy chain Jhoots Chemist, with over 100 outlets, faces potential administration after Lloyds Bank sought a High Court application relating to £670,000 in unpaid fees. The firm has faced criticism over non-payment to locums and creditors, and reported debts above £5m plus a near £1.9m loss in its latest year.
Why it matters (selling on credit): Large multi-site customers can still become slow payers — tighten terms early when supplier complaints and legal actions start to appear.

Eurostar

Eurostar says that services have resumed after a power issue in the Channel Tunnel disrupted operations yesterday. The operator plans to run all of its services, but warned of potential delays and last-minute cancellations due to knock-on effects

Corporate & finance

London Stock Exchange sees IPO surge

The LSE recorded 11 IPOs in 2025, raising £1.9bn — up from £700m in 2024 — with a strong final quarter contributing £1.3bn. Notable listings included Princes Group (£400m) and Shawbrook (£348m). Advisers expect momentum to continue into 2026, with a pipeline across consumer, financial services and TMT.
Why it matters (selling on credit): Expanding, fast-moving companies can still extend payment terms — keep credit limits aligned to real payment performance, not headlines.

Private equity continuation vehicles hit record use

About 20% of private equity sales in 2025 reportedly involved continuation vehicles — effectively selling assets into structures controlled by the same sponsor — up from 12–13% the prior year. The approach can return cash to earlier investors, but raises conflict-of-interest and valuation concerns. Total PE sales are forecast around $107bn (£79.2bn), up from $70bn in 2024.
Why it matters (selling on credit): Complex ownership can reduce transparency — ongoing monitoring matters as “who pays” can become less obvious after restructures.

Housing & property

Landlord laws relaxed overseas as UK heads for tighter rules

Portugal and New Zealand have moved to relax aspects of landlord regulation to support buy-to-let investment: New Zealand reversed a five-year ban on no-fault evictions, while Portugal is considering landlord income tax cuts. Commentators warn that tougher UK regulation — including the upcoming Renters’ Rights Act — could shrink rental supply further. London rents are cited at a record £2,736.
Why it matters (selling on credit): Higher rents squeeze household and small-business budgets, increasing the chance of stretched cash flow and slower invoice payment.

Global & markets

China factory activity returns to growth

China’s official manufacturing PMI rose to 50.1 in December from 49.2 in November, ending eight months of contraction. The rebound will be welcomed after weaker consumer and investment data earlier in the month.
Why it matters (selling on credit): Any stabilisation in China can ease supply-chain pressure, but volatility in demand and pricing can still hit customer cash flow.

Warner Bros Discovery weighs rival bids

Warner Bros Discovery is reported to be leaning against a $108bn bid from Paramount, with an $83bn offer from Netflix seen as more attractive. No final decision has been made, but the board is expected to meet next week.
Why it matters (selling on credit): Major deals can disrupt procurement and payment processes — suppliers should watch for changes to billing entities and approval chains.

Market snapshot

  • FTSE 100: Closed yesterday at 9,940.71, a record high, with a +21.6% gain for 2025 and 41 record closes this year.
  • Euro Stoxx 50: Closed at 5,796.20 (30 Dec).
  • S&P 500: Down 0.1% to 6,894.24; Nasdaq: 23,419.08 (thin year-end trade, “Santa rally” wobble).
  • Global equities: MSCI All Country World Index up about 21% for the year, heading for the best annual gain in six years.

Commodities

  • Gold: Rebounded to about $4,335/oz, still on track for its best annual performance since 1979 (up 65%+ in 2025).
  • Silver: Held above $75/oz after sharp month-end swings.
  • Copper: Hit a record near $13,000/tonne, best year since 2009.
  • Oil: WTI $57.95, Brent $61.92 — oil on track for the deepest annual loss since 2020 (down ~20%) amid oversupply concerns.

FX

  • GBP/USD: Pound fell 0.33% to $1.3469.
  • GBP/EUR: Sterling strengthened to a two-month high, though still on track for its first annual loss vs the euro since 2022.
  • EUR/USD: Euro eased to $1.1749; US 10-year yield around 4.12%.

CPA can help

If 2026 is shaping up to be slower and tougher, don’t wait for late payment to surprise you. Use CPA CreditCare reports and ongoing monitoring to spot risk earlier, set sensible credit limits, and tighten terms where needed. And if an account slips overdue, we can support structured recovery that protects the relationship while improving your chances of getting paid.


Just call Peter Uwins, CPA’s National Sales Manager, on️ 020 8846 0000 (business hours from Monday 5th) or email nsm@cpa.co.uk 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.

Insolvency Notices (Companies)

Appointment of Administrators

  • 30 BRUTON STREET RETAIL LTD
  • APIC UK LIMITED
  • CC BUSINESS SERVICES LIMITED
  • RECOM SURFACING LIMITED
  • SIXES GROWTH LTD
  • TEESSIDE GREEN ENERGY PARK LTD
  • THE NORTH LINCOLNSHIRE GREEN ENERGY PARK LIMITED
  • THE STUDIO PEOPLE LIMITED
  • THURSTON GROUP ESTATES LIMITED
  • THURSTON GROUP LIMITED
  • THURSTON HOLDINGS LIMITED
  • TRACEY MILLER FAMILY LAW LIMITED

Appointment of Liquidators

  • AFS LONDON LIMITED
  • AI CONVOY BIDCO LIMITED
  • ALTERNATIVE CREDIT INVESTMENTS LIMITED
  • AMBASSADOR SEAFOODS LIMITED
  • ARENA WEALTH MANAGEMENT LIMITED
  • CHESHIRE 2020-1 PLC
  • COLNE VALLEY RAILWAY COMPANY LIMITED
  • DF GROUP LIMITED
  • FORDBANK LIMITED
  • GEMMTECH LIMITED
  • GLENERNIE CAPITAL LTD
  • GLENERNIE PARTNERS LTD
  • LH & SONS LTD
  • LICKPENNY LIMITED
  • LOCKMAN INVESTMENTS LIMITED
  • M & J COWEN FARMS LIMITED
  • MARK CARDY CONSULTANCY LTD
  • MUDDY MACHINES LTD
  • PHOENIX HOMES COLCHESTER
  • PINES PROPERTY DORSET LIMITED
  • PROCESS & PROGRESS LTD
  • SANDERS MELBER LIMITED
  • VERCERN LIMITED
  • WATERFALL EIT UK LIMITED
  • WILLOW BROOK SERVICES LIMITED

Petitions to Wind Up (Companies)

  • VIRGINIA’S CHAMBERS CIC
  • DFB PLUMBING AND HEATING LTD
  • FRESCO A-C LTD
  • GREEN COLLAR RESOURCES LTD
  • HOME BARGAINS GROUP LTD
  • RUBOB HEATING AND RENEWABLES LTD
  • SWIFT CARS COATBRIDGE LIMITED