Particularly for the retail and hospitality sectors, the last year or so has been pretty bleak. Big names like Toys R Us, Maplins and Poundworld all disappeared from the high street, whilst a long list of others, including Prezzo, Carluccio’s, Marks & Spencer. Mothercare and New Look have shrunk.
The number of insolvencies of individuals in the year was 115,299, continuing a steady year-on-year rise which began in 2015. This gives the highest annual figure since 2011.
The Insolvency Services has recently published the official insolvency statistics for 2018. As widely reported, pretty sorry reading they make. Here are our thoughts on how 2019 may look.
How do you spot the warning signs of a failing business?
It’s quite common for individuals running companies to appoint their spouses or partners as directors of their company, even though there is no intention that the spouse or partner should take any active role in the company’s management. Apart from anything else, there may be sound tax mitigation reasons for doing so.
For both politicians and the media, pre-packaged sales of businesses out of administration (or “pre-packs”) are often highly controversial, particularly when the sales are back to the directors or management of the failed enterprise. There is a perception that pre-packs are often abused by unscrupulous directors to simply “dump debts” and start afresh free of troublesome liabilities, and all for far less than the true value of the business.