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R3 welcomes low distress and high growth 8 July 2014

The levels of business distress and business growth have remained at record highs and lows respectively, according to insolvency trade body R3.

Figures from the latest Business Distress Index show 68% of businesses are showing “one key sign of business growth”, while 35% are showing “at least one key sign” of distress.

R3 president Giles Frampton said: “The Business Distress Index continues to throw up some very positive results. It’s encouraging that business growth isn’t yet showing signs of decelerating and the pace of the recovery is being kept up.

“Businesses need to be on the lookout for any signs that they’re over-stretching themselves though. Sales, profits, and business expansion may be on the up, but if a business runs before it can walk then problems can emerge.”

Despite the encouraging progress in recovery levels, the figures show signs of growth and distress are regionally uneven, as 73% of businesses in the South reported at least one sign of growth, failing to 69% in the Midlands and 59% in the North.

Correspondingly, 34% of businesses in the South and 30% of businesses in the Midlands reported at least one sign of distress, rising to 43% in the North.

Frampton commented: “While it’s good to see growth continuing apace in all the UK’s regions, Westminster needs to bear in mind the fact that the South is pulling further and further away from the rest of the country in terms of economic performance.”

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