In Focus Collections
Business distress We also track more general signs of business distress, and have detected an increase in these signs from earlier in the year. Three-fifths (60%) of businesses (up from
With uncertainty coming at them from several vectors, businesses need to stay on their toes and ensure they are in shape to meet the future demands of the market, and customers’ ever- higher expectations
While they still need a lot of work, the
government’s insolvency-reform proposals could give insolvency practitioners more tools to help turn around struggling firms, and boost productivity.
March 2019
57% in April) reported that they have recently experienced at least one of the following: l Being owed payment on invoices that are over 30 days past due (20%). l A reduction in sales volumes (16%). l Decreased profits (16%). l Regularly using the maximum overdraft facility (13%). l Having had to make redundancies (12%). Conversely, signs of growth have dipped
from April. Two-thirds (67%) of businesses (down from 69% in April) said they had seen at least one of the following signs of growth: l An increase in sales volumes (25%). l Investing in new equipment (22%).
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l Increased profits (21%). l Market share has recently grown (17%). l The business is expanding, either geographically, increasing staff numbers, or into new areas of business (17%).
Conclusion It is worrying that business distress signs are ticking up, while growth signs are trending downwards. With uncertainty coming at them from several vectors, businesses need to stay on their toes and ensure they are in shape to meet the future demands of the market, and customers’ ever-higher expectations. Any business can be blind-sided by a
sudden change in its operating environment; longer-term and more gradual changes must also be monitored carefully, to avoid the risk of stagnation. In a distress scenario, the perspective of a third-party advisor can be invaluable for helping directors determine the best way forward. CCR
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