Business news affecting recent insolvencies and credit management

19th June 2019

Some days there is nothing in the news that overlaps with the world of credit management. Today is not one of those days. Today is such a busy day that we are just going to put a lot of what we have seen in the media altogether here in one post with a brief summary.  We have however written an entirely seperate blog on the governments proposals to tackle late payments

Goals ‘blocks’ accounting probe

Goals Soccer Centre, which in March revealed that it owed £12m in VAT, has been accused of having “stonewalled” calls from its largest shareholder, Sports Direct, for an external probe into its £12m accounting crisis. Mike Ashley had urged Goals to approve an external investigation over fears about the scale of the possible issues, over which former Goals auditor KPMG has been reported to be on standby for a potential lawsuit. Sports Direct says Goals’ lenders have appointed Deloitte to conduct an internal investigation but are yet to confirm whether this will be shared beyond creditors and directors.

No buyer for Bathstore

BDO has been lined up to handle a potential administration of bathroom retailer Bathstore after the loss-making business failed to find a buyer. The latest accounts filed at Companies House show the retailer making a pre-tax loss of £22m on sales of £141m in the year to 31 July 2017.

Monsoon offers share of profits ahead of CVA

Monsoon Accessorize’s owner Peter Simon will offer landlords a share of future profits worth up to £10m as he attempts to persuade creditors to vote for a Deloitte-led CVA which would allow him to reduce the size of his stores and pay less rent. The insolvency procedure has been delayed for several weeks as landlords sought additional sweeteners, including an equity stake in the business. Mr Simon has also pledged to invest £34m in the 270-shop fashion retail chain to keep it afloat.

Monsoon seeking lower rents to stay afloat

Monsoon Accessorize is asking landlords to reduce rents on more than half its 258 leased stores in return for a share of £10m future profits. Under the restructuring, which is taking place under a two separate CVAs in a process overseen by Deloitte, no stores would close and no jobs are expected to be lost from the 4,440-strong workforce. Owner Peter Simon, who has also given the company an emergency £12m loan and offered another £18m at 0% interest if the CVA is approved, said that it had faced “significant pressure” on working capital because of the removal of trade credit insurance, meaning it has to pay suppliers up front.

Considering the use of CVAs by retailers. Nils Pratley in the Guardian asks “how many more of these requests from wealthy individuals are landlords prepared to tolerate?” He suggests landlords “hold a poor hand, but they’re also playing their cards weakly” and says they have themselves to blame if an “open season for retail CVAs” occurs.

Collapsed firm sold

Tech firm Hutchinson Networks, which last month went bust, has been sold to Irish tech group PlanNet21 Communications. Blair Nimmo, joint administrator and UK head of restructuring at KPMG, said the acquisition “will provide the new owners with a fantastic base from which to expand their operations into the UK.”

Jobs saved at Redhall Networks

More than 50 jobs have been saved after the trade and assets of Redhall Networks were purchased by Enact. Chris Petts and Sarah O’Toole of Grant Thornton were appointed administrators.

Construction firm collapses

Construction firm Shaylor Group has fallen into administration, with FRP Advisory in discussion with the company’s clients regarding the transfer of sites and supporting workers affected by the closure.

Bank set to hold interest rates

The Bank of England is expected to hold interest rates again today, with economic growth slowing sharply after a stock-building boost at the start of 2019. The MPC is expected to keep rates at 0.75%. Data released yesterday showed that inflation had fallen to a target of 2% in May, down from 2.1% in April, a development that could give the Bank more breathing space to keep rates unchanged. Core inflation, which excludes more volatile food and energy prices, dropped to 1.7% – the lowest figure since early 2017.

Factory output slows

According to the latest industrial trends survey from the CBI, factory output almost ground to a halt in the three months to June. The business lobby group said that a net balance of 2% of businesses reported an increase in output during the period. This was down from 14% the previous month, when manufacturers were lifted by Brexit-related stockpiling. The CBI said that ten out of sixteen sub-sectors experienced growth. The balance of manufacturing businesses reporting higher-than-usual orders fell to -15% in June, down from -10% last month.

Young people see spending power shrink

Young people’s spending power is less than it was in 2001, Resolution Foundation research has found. The analysis reveals that 18 to 29-year-olds are spending £380 per week on non-housing items, marking a 7% decline in real terms on what those in the same age group spent in 2001. In the same period, those aged over 65 have seen a 37% increase in spending power.

London dragging on UK house prices

London continues to drag on UK house prices, according to data by the Office for National Statistics, with the capital enduring the lowest annual growth out of any region with prices falling 1.2% over the year to April 2019. Prices across the UK rose an unadjusted 0.7% month-on-month in April, the first rise in eight months, taking the average property price to £229,000. In England, the East Midlands saw the strongest annual house price growth in April, with a 2.9% increase. Regionally, Wales saw the strongest growth in the UK of 6.7% in the year to April, followed by Northern Ireland at 3.5%, Scotland by 1.6% and England by 1.1%. Northern Ireland remains the cheapest country in the UK to purchase a property, with an average house price of £135,000.

There were more insurance claims to cover the non-payment of debts in the first three months of this year than in any other quarter over the last decade, the Association of British Insurers (ABI) has revealed. The ABI said continued Brexit uncertainty, competition from online sales, rising business rates, lower consumer spending, and a weaker pound were all to blame.

The findings show that there were 5,114 trade credit insurance claims made by UK businesses in the first three months of this year – the highest quarterly level seen since 2009. The total value of claims paid was £48m, up by £1m compared to the previous quarter, with an average payment of £9,000 made to 57 firms every day. This comes after the latest government figures revealed a 6% increase in company insolvencies in the first three months of this year.

CPA is passionate about late payment

The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.

We are passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.

If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.

As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.

Under little used legislation, you are entitled to compensation for those late payments.

Now you can boost your own cash-flow.

CPA can help unearth the those hidden treasures.

We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.

Yes, CPA can help you boost your business cashflow.

Don’t let your bankers control you, contact CPA today.

Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

visit our late payment compensation page

See our full blog and FAQ on late payment compensation

If you are also struggling, do you realise you could be sitting on a fortune?

Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.

If you are struggling and sold B2B on credit then there may be a hidden source of capital you can call on.

If you need extra capital, rather than shutting down or jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.

Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.

We can help you uncover the pile of gold, you didn’t even know you were sitting on.

If you trade with other businesses and were often paid late then you could be entitled to significant compensation.

Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.

Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.

You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.

That compensation could be the cash rescue your business needed.

But don’t delay, that compensation evaporates if not claimed within six years of the late payment.

How can CPA help?

CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.

We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.

Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.

CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.

The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit.  You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.

We do the work, you receive the cash.

If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.

We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.

We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

Do you sell on credit?

With pressures on the UK economy it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.

With tightening cash flow they will look for the easiest option  to boost their cash-flow. Don’t let it be you.

You can’t just assume your customers can and will pay you, no matter how big their name is.

It is essential to have credit management systems in place to monitor and check your customers credit worthiness.

It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.

See the section below – About CPA.

About CPA

The Credit Protection Association can help!

Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.

At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.

We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.

Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.

If you supply on credit, help us help you identify the risks.

Why use a third party collector?

As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When you customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.

Over the years we have collected billions in overdue invoices for our customers.

Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

Keep up to date with the latest news by following us on social media:-

CPA on Linkedin

CPA on facebook

CPA on twitter

See all our latest news here!

How to overcome 25 of the most common excuses for non-payment

Discover how to improve your cashflow in 3 steps.

Read our blog – Debt collection agency

Read our Cash Flow Advice

Read about our overdue account recovery service

Read our blog – What is credit management?

Read our blog -What is a credit management company?

Read our blog -Credit Management that works!

Read our blog – How to select a debt collection agency

click to see read about our successes