Rate of business closures slows

20 January 2010

20 January 2010 | Jake Kanter

The number of UK firms going bust increased in 2009 but at a slower rate than the previous year.

Figures from information services provider Experian show the total number of company closures rose 12 per cent to 24,368 last year. This was compared with 21,763 insolvencies in 2008, a rise of 29.3 per cent on the year before.

Firms in the north east of England were worst hit by closures, while businesses in Scotland maintained the lowest rate of insolvencies in 2009. More companies in the plastics and rubber sector went bust than in any other industry last year, according to Experian.

Rolf Hickmann, managing director of pH, an Experian company, said UK businesses had managed to “climb back to a better place”, but warned against complacency.

“Many more businesses are taking steps to protect themselves from the risks of not getting paid, the impact on them if a key supplier or customer goes bust and indeed the risk of insolvency within their own businesses,” he said.

“With this in mind, businesses need to not only proceed with caution when it comes to new and existing business clients, but also ensure that their own house is in order, so that they themselves are appealing prospects for business.”

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