Business insolvencies in September fall

news release

Business insolvencies in September fall 

SME picture shows stability
Firms in West Midlands and South West see biggest improvement

22 October 2012 – The latest BusinessIQ Insolvency Index from Experian®, the global information services company, reveals a 3.1 per cent drop in number of business insolvencies in September 2012 compared to September 2011.  Highlighting a stable picture amongst businesses, the data shows that during September, 0.08 per cent of the business population (1,679 companies) failed.

Smaller firms, all those falling into the categories of between 1 and 50 employees, saw the greatest improvement in their average insolvency rate compared to September 2011.  This was led by firms with 26 to 50 employees that saw their insolvency rate fall from 0.23 per cent to 0.19 per cent, while firms with 6 to 10 employees saw their insolvency rate fall to 0.13 per cent, the lowest since January 2011.

The only year on year increase in insolvency rates came from larger firms; all those with between 51 to 500 employees. 

Max Firth, Managing Director, Experian Business Information Services, UK&I said: “Overall insolvency figures are down and the picture remains stable, which is encouraging. In addition, we’ve seen real pockets of improvement, such as in the West Midlands and South West, which have both seen a drop of over 30 per cent.  Also encouraging are the lower rates of insolvencies among some of the small firms.   However in contrast, larger firms experienced a slight increase in insolvencies, which may lead to smaller firms that were supplying to them, experiencing a knock on effect. 

“This highlights the need for firms need to be prudent and consider their credit management practices in order to survive.  Risk planning and monitoring their financial health and that of their customers and suppliers can make or break a business.”
The West Midlands falls to lowest rate since June 2007
Figures for the West Midlands showed the total number of insolvencies were down by 34 per cent in September 2011 to 0.07 per cent, hitting the lowest rate since June 2007.  The picture in the South West was also relatively good compared to the rest of the UK – with a fall in its insolvency rate from 0.09 per cent in September last year down to 0.06 per cent in September 2012. It also saw a fall from this August’s figure of 0.07 per cent.

In addition, Yorkshire and South East were the only regions to see an increase in insolvency figures on September 2011, with Yorkshire at 0.12 per cent seeing a 22.8 per cent increase in business insolvency rates and the South East is up 7.2 per cent to 0.08 per cent.

Sector view
Out of the top ten largest sectors in the UK, Building and Construction fared best, with a drop in the insolvency rate from 0.17 per cent in September 2011 to 0.14 per cent in September 2012– better than any other sector.

The latest analysis has been compiled using some of the most comprehensive business data on the market. This data powers BusinessIQ, a new easy-to-use, integrated online platform that enables credit professionals to accurately and efficiently manage its business customers and all the risks and opportunities associated with them - from acquisition stage and throughout the life cycle of the relationship.  This includes giving firms an early warning system on customers that might be getting into financial difficulty.

Insolvency Index tables


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Serjeet Heera
Head of PR for Credit Services
T: 44 (0) 115 992 2773 | M: 44 (0) 7837 652169

About Experian
Experian is the leading global information services company, providing data and analytical tools to clients around the world. The Group helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.

*Actual September 2012 figure for the North East is 138 insolvencies; this includes 97 insolvencies of subsidiaries (many dormant) all linked to a single corporate group. To include these in the figures for the North East would imply a significant deterioration in that region which we do not feel reflects reality. Hence they have been excluded and the figure adjusted down to 41.

Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2012 was US$4.5 billion. Experian employs approximately 17,000 people in 44 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.

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