There has been a “sharp” increase in the number of north west firms entering administration, according to analysis from KPMG.
Analysis showed the number of north west businesses that entered administration in Q3 had increased by 68 per cent.
Between July and September, 86 north west companies went into administration, compared with 51 in the previous quarter.
The number of businesses that entered administration increased by around three fifths - 60 per cent - compared to the same period the previous year.
Some 211 north west businesses have entered administration in 2019 so far, including the high-profile cases of Late Rooms, Polyfilm, Ferguson Marine Engineering, Eversmart Energy and Sidcot Group, KPMG said
Rick Harrison, restructuring partner at KPMG in Manchester, said: “For some time now, corporate insolvencies have been ticking along at fairly steady levels, so the more marked increase in administrations seen last quarter may herald the start of a new wave of activity.”
He said this is “perhaps unsurprising” as businesses had been presented by challenges including “fragile consumer confidence, rising overheads from fluctuations in exchange rates, increasing employment costs and political uncertainty across the region”.
However Mr Harrison said, in light of challenges, companies are “proactively addressing long-term issues and are attempting to place themselves on a more sure financial footing, ahead of any further macro-economic challenges that are coming down the line”.
“From CVA proposals for retailers, to refinancing in other sectors, there are definitely options out there, and they seem to be paying off for those firms that have opted to take a fiscally cautious approach.”
Nationally, the number of companies that entered administration during Q3 increased by more than a third - 35 per cent - to 417.
When compared to the same period in 2018, the figure increased by 30 per cent, up from from 322 businesses.
The building and construction sector saw a “marked increase” in administrations, up from 49 in Q2 to 76 in Q3 2019, while the property sector saw insolvencies rising from 18 to 33.
Pubs, restaurants and clubs also saw an increase in administrations, from 14 to 26 in the same period, however the number of retailers going into administration had fallen from 26 in Q2 to 18 in Q3.
