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.”
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