Latest research from the Midlands branch of national insolvency and restructuring trade body R3 paints a challenging picture for the East Midlands economy, with indications that business start-ups are increasing, while companies are having to fight harder to survive.
R3’s figures, which are based on an analysis of data from business intelligence provider Creditsafe, highlight that the East Midlands had 2675 start-up companies in March, an increase of 418 on the previous month’s figure of 2257. Conversely, the region also had 237 insolvency-related activities last month, an increase of 143 on February’s statistic of 94.
The R3 research also indicates that, in March, the number of East Midlands companies with late payments was 26,388, a marginal decrease on February’s figure of 26,581.
R3 Midlands chair Eddie Williams, a partner at PwC in the region, said: “These figures reveal the extent to which local businesses are having to fight to survive and grow in this current economic climate. While the increasing number of start-ups in the region is positive, it is obvious that late payments are likely to be a significant contributory factor in local business insolvencies.
“Both the global and local economies are hugely challenging at present and impact heavily on the relatively high number of small businesses we have in the East Midlands, particularly those in vulnerable industry sectors such as hospitality and tourism.
“It is therefore even more crucial for local business owners, whether in start-ups or established companies, to be on top of their invoice ledgers and tackle late payments and the impact of bad debts as soon as they become evident.
“For those businesses which are already struggling, or whose directors may be worried about its 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 consultation to those who are looking for such help and want to explore their options.”
