Begbies Traynor Group

Number of firms on Merseyside in ‘significant’ financial distress now surges past 5,000

Jason Greenhalgh of Begbies Traynor in Liverpool .jpg
Date Published: 22/01/2024
  • 4% year-on-year increase in the number of Merseyside firms on the brink.
  • 13 % increase from the previous quarter alone.
  • Key sectors of property, professional and support services make up bulk of distressed firms.

Fresh data released today by Begbies Traynor reveals the number of firms on Merseyside starting 2024 on the brink has now surged past 5,000.

In Q4 of 2023, the number of firms on Merseyside operating in ‘significant’ financial distress was 5,596 according to the research. This is a year-on-year increase of 3.59% (up from 5,402) and an alarming quarterly jump of 12.6 (up from 4,970).

This latest data is sourced from the Begbies Traynor Red Flag dataset which tracks key factors behind company distress and failure rates.

‘Significant distress’ refers to businesses showing deterioration in key financial ratios and indicators including those measuring working capital, contingent liabilities, retained profits and net worth.

The biggest double-digit percentage leaps in distress compared to the previous quarter were seen in Printing & Packaging (58%), Travel & Tourism (38%) and Financial Services (27%).

The largest volume of distressed businesses are found in the quartet of key economic sector hubs in the Lancashire region: Construction, Real Estate, Support Services and Professional Services which, together, make up more than half (54%) of the total (3,027) number of significantly distressed firms.

Stephen Berry, partner at Begbies Traynor in Liverpool, said:

“2024 has been a challenging start for SMEs on Merseyside. There’s no doubt that the build-up of pressure from last year continues to have a major impact and this latest data demonstrates the size of the problem for businesses in our region.”

“Recent inflation figures announced compound the threats even further for business owners struggling to stay on top of things as those in their supply chain pass greater costs on in order to survive.

“The fact that more than half of these companies in significant distress operate in the traditionally strong sectors of construction, property, professional and support services is of grave concern for everyone doing business in these areas” 

Jason Greenhalgh, partner at Begbies Traynor in Liverpool, added:

“With a General Election looming later this year, it is feasible we could see further support for businesses being announced in the next Budget. It remains to be seen whether this would be too little too late for many of the firms in our region included in our numbers.

“These new figures are a stark reminder for company directors on Merseyside to act quickly and decisively in order to generate more options for rescue than if they bury their heads in the sand.”

About The Author

Meet the Team

Jason first started at Begbies Traynor in July 1989 as a junior on the old YTS scheme via the Chamber of Commerce in Manchester and progressed through to Senior Administrator over a period of time to 1997.

After a short time away, he rejoined Begbies Traynor and sat the JIEB Insolvency Exams in December 2002 and initially obtained a non-appointment license the following year after which he  continued to progress through the grades to Senior Manager.

In May 2008 Jason was promoted to Insolvency Director, upgraded his insolvency license with the IPA and has taken corporate insolvency appointments since then. In July 2011 Jason was rewarded for his efforts and commitment to Begbies Traynor when he was promoted to Partner.

Throughout his insolvency career, Jason has gained valuable experience at every level and has dealt with a wide range of different insolvency assignments. Since taking appointments in 2008, he has concentrated on the mid range insolvency market and has helped many struggling owner/managers of distressed businesses.

Jason enjoys rugby league and follows his local team the Leigh Centurions. He also enjoys attending live music events and keeping fit.

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