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Q3 company insolvencies up 9% 3 October 2011

Over 580 construction companies were among those affected, with 391 manufacturers also hit by a difficult trading environment.

Retail (410 companies), hospitality and leisure (235 companies) and property (109 companies) were the next three worst-affected sectors, according to statistics released by PricewaterhouseCoopers.

Mike Jervis, partner in the business recovery unit at the firm, said businesses would be unwise to assume that consumers will be spending indiscriminately over the coming months as fears about the economy continue.

He explained: “The impact of public sector cuts on the private sector is only just being felt. There have been a number of warnings this week, but the ripple effect down the supply chain is still rather invisible.

"Managing the fall-out from this will be a major factor contributing to the trends in the December quarter insolvency numbers.”

Tough trading ahead

Jervis added that, while a lot of retailers will be breathing a sigh of relief at the passing of the September quarter, many are going into the most crucial period of trading with little or no room for manoeuvre.

He continued: “Retailers and their stakeholders need to forecast obsessively, especially on their cash, and think about what the period post Christmas might look like.”

London had the highest rate of insolvencies with 899 companies going insolvent during the period which is a 21 per cent increase, compared to the same quarter last year.

By Joe McGrath



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