The number of firms going into administration fell by 14 per cent, to 310 between April and June 2019, a study by KPMG of notices in the London Gazette has shown.
Blair Nimmo, head of restructuring for KPMG UK said; “You could be forgiven for thinking there had been a dramatic increase in corporate insolvencies.”
Notable failures in the second quarter of this year have been the collapse of Bathstore and Jamie’s Italian. Both insolvencies have resulted in 1000’s of job cuts.
The number of retailers going into administration remained relatively flat, falling from 28 in the first quarter to 26 in the second. However, this does not include the figures on CVAs. Monsoon and Arcadia have closed stores or cut rents on hundreds of others, so it could be argued that retailers are suffering more than they did in the previous quarter.
However, there was a more pronounced increase in the number of businesses in the food and drink sector going into administration – 18 failed in the second quarter compared to 13 in the previous three months.
Overall, these figures are not the whole story as it doesn’t include the number of liquidations. There are many more liquidations, some 15,000 per annum, than administrations as it tends to happen when the company has no hope of survival. Small companies tend to go into liquidation as there are not enough funds to facilitate a turnaround or sale.
The insolvency service will release statistics on the 30th of July that should give a clearer picture.