According to PwC the number of UK firms filing for insolvency in the first quarter was broadly similar to the same period in 2021.
But they also reported: “when the smallest firms and companies that were liquidated when solvent are stripped out, the figures show those filing while insolvent more than doubled in the first quarter…” (our italics).
But why would a solvent company go into liquidation?
Well, there could be a number of reasons, perhaps related to family or lack of successors.
However, given the number of economic headwinds, including inflation, supply chain problems, labour shortages and energy costs, as BDO has reported business optimism has fallen by 4.82 points to 101.93, for the second consecutive month, perhaps it should not be so surprising that patience is wearing thin.
Don’t throw in the towel just yet!
We would advise businesses to hang on in there, especially if they are still solvent, conditions will eventually turn around as they always do.
It can’t hurt to ensure that you take regular breaks to refresh yourself, perhaps go for a long walk, take time out with family, or indulge in a hobby.
Even for those that are insolvent there are alternatives to liquidation.
Firstly, get a grip on tracking the company finances with our free downloadable Cash Management tool.
Perhaps your business could pivot to meet these needs and at the same time strengthen its own future for growth?
Give us a call or message if you would like to talk to someone about restructuring possibilities for and investment in your business.