Private Equity and Business Insolvency

Nicholas Young, MD of turnaround specialists Beer & Young, noted with interest the comments in this week’s edition of insolvency news; 

“During one of the toughest times in living memory across the public sector, HM Revenue and Customs, Treasury and Insolvency Service staff have all privately told insolvencynews.com this week that the only option is to plough on regardless. The Insolvency Service's steep challenges were recently laid bare in a blunt address from a union boss, at a time when the organisation is seeing significant influence over its own affairs shift to the Treasury, as well as the Department for Business, Innovation and Skills”.  

These comments mirror our own experience at the present time. Rightly so HMRC are getting tougher with non-payers of tax, and whilst it is also more difficult to make 12 months + arrangement on the Time to Pay scheme, it also seems there is a reluctance by the Tax Offices to seek recovery actions through the courts for legacy debt particularly where the business in question is now paying current taxes on time.

Beer & Young Commended at Business Moneyfacts Awards

We are delighted to announce that Beer & Young has picked up the ‘Commended’ Award for ‘Best Corporate Finance Boutique’ at the Business Moneyfacts Awards ceremony held on 24th March at the London Marriott Hotel, Grosvenor Square.

The Business Moneyfacts event celebrated its 10th year and was attended by some 400 industry professionals.

 Lee Tillcock, Editor of Business Moneyfacts said “the ceremony has recognised those providers, brokers and trade bodies that helped to make 2010 a more positive year for businesses”

Government disagrees with itself on the impact of Business Link's closure, says enterprise group

Government research into the potential impact of the closure of Business Link suggests ministers will not meet their own objectives for effective business support, an enterprise group has suggested.

The national enterprise network, which represents local enterprise agencies, made the claim ahead of the winding down of local elements of government-backed Business Link services which will be replaced by the main national Business Link website and a call centre.

The group pointed to research commissioned by the Department for Business, Innovation and Skills in November 2010 which concluded: "A reduction in the availability of Business Link’s face to face service could result in a lower take-up of external advice, and confusion remains about which sources of advice to trust.

"Start-ups and new businesses will be particularly affected as they are the least likely to know what support they need, the least able to find or trust appropriate support and the least able and willing to pay for this support."

The study also found that for many entrepreneurs, the Business Link website complements, rather than substitutes for, telephone and face-to-face support, is not a key route to face to face support and is "barely looked at" by many company owners before getting in touch for advice.

All this, NFEA said, conflicts with the government's heavy focus on online support in the new system of business support. "Online business information is undoubtedly valuable but it appears that this is rarely regarded as a useful form of business support, other than in answering factual queries," the organisation added, "Nor is it seen as an adequate replacement for face to face advice.

"We appreciate that major changes to the website are planned, but this is a massive task and whilst it may improve the usability and relevance of the content, it will not remove its perception as a government-owned service, the use of which will benefit the government rather more than the business user."

NFEA also criticised the government's suggestion that "the best advice for business comes from other experienced business people". The group disputed this saying that while experience is important, qualified and professional business advisers offer the best guidance.

"The best musicians do not make the best music teachers, and vice versa," it added. "The best footballers do not make the best football coaches, and vice versa. And we would suggest that successful business people do not always make the best business advisers, nor will they necessarily make the best business mentors."

Concluding its list of concerns, the NFEA said it was worried that the abolition of the local Business Link service "will have a damaging effect on the rate of new businesses coming through, the quality of their management, the rate of their growth and ultimately their sustainability".

Article sourced from businesszone.co.uk

Corporate failures fall more than 10 per cent

The number of UK firms going bust dropped in January by more than 10 per cent when compared to the same month last year, according to Experian’s latest Insolvency Index.

The credit reference agency’s figures revealed that 1,266 businesses failed in January 2011, down from 1,426 during the same month in 2010.

Further findings from the research showed that businesses in the south west were among the most robust, with insolvencies in this region falling 11 per cent.

Wales and the north west were the only two regions to see an increase in the rate of business insolvencies when compared to the previous year, with a 33 percent rise in the north west and 56 per cent in Wales.

Max Firth, managing director of Experian pH, said: “Our analysis shows that business failure rates are falling steadily and the financial strength of the UK’s business community is improving.

“Our data also shows that the post-recession business population is beginning to increase once again, with the net number of firms trading up by one per cent when compared with last January.”

Nicholas Young, Managing Director at Beer & Young comments: “These figures are of course welcomed, particularly in light of the poor trading for the previous quarter for “UK plc”. However, whilst business failures are down, so many businesses are struggling with their finances. Balance sheets are weak and banks are themselves finding it difficult to lend to SME’s. Equity funding can be the answer. Private investors have capital available and bring added value skills with their money. They can be the difference between growth, profits and business growth, over struggle, firefighting and stress for business owners.”