Latest research from the Midlands branch of the UK’s insolvency and restructuring trade body R3 reveals increased caution among East Midlands entrepreneurs with a significant fall in the number of newly-formed companies in the region.
R3’s monthly figures, which are based on an analysis of data from business intelligence provider Creditsafe, show that the total number of East Midlands start-ups decreased by over a quarter (25.32%) at the end of 2022, falling from 2,235 in November to 1,669 in December.
Growing caution amid fears of recession could also be behind a fall in the number of the region’s companies with late payments, with business owners tightening up their cashflow procedures as economic pressures threaten. The figures show that the total number of East Midlands companies with invoices past their settlement date dropped from 27,077 in October to 24,315 in December, a sizeable decrease of 10.2%.
R3 Midlands chair Eddie Williams, a partner at PwC in the region, said: “Notwithstanding news that the UK economy grew by 0.1% (ONS) in November – boosted by Christmas spending and the men’s football World Cup – this research indicates that trading conditions remain extremely challenging.
“Despite the current economic turmoil and its negative effect on start-up totals, it is encouraging to see a fall in the number of East Midlands companies with late payments. At R3 Midlands, we can see how hard so many local businesses work to maintain cashflow, demonstrating their creativity and crisis management skills in their relationships with suppliers, creditors and funders, as well as reaching out for professional help.
“For those business owners with significant concerns about their situation, the sooner professional advice is sought, the more opportunities may be available for finding the best possible outcome. Many R3 members offer a free initial consultation to those who are looking for such help and want to explore their options.”
