Business distress rising in Yorkshire and Humber areas, report says

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Businesses in the Yorkshire and Humber areas are seeing a “rising tide of financial distress”, according to an influential business report.

The latest Red Flag Alert report from business recovery specialists Begbies Traynor found that the number of companies in Yorkshire suffering early-stage or ‘significant’ distress rose 36% on last year, while the number in the Humber area rose 25%.

The company said that high interest rates and supply chain issues remain persistent problems for many firms, despite early signs of the UK coming out of recession. The increase in distress in Yorkshire was worse than the national average on the measure, which highlights companies seeing deterioration in a number of key financial areas, though the Humber figures were better than many other regions.

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Begbies Traynor said that very severe, or ‘critical’ business distress, which puts companies in imminent danger of insolvency, had risen by 33% in Yorkshire since the first quarter of last year. Companies in the retail and food sectors were badly affected.

Julian Pitts, Begbies Traynor’s regional managing partner in Yorkshire, said: “Persistently high interest rates continue to pile pressure on beleaguered businesses who are struggling with the costs of servicing debts, at a time when reduced consumer demand is exacerbating financial strains.

“This is compounded by geo-political turmoil and ensuing supply chain disruptions and although economic growth is expected to rally this year, in the current environment we are advising businesses to keep tight control of their finances and seek professional help at the first signs of trouble to avoid problems becoming insurmountable.”

Andrew Mackenzie, the company’s partner in the Humber region, said: “Beleaguered businesses are struggling in the face of persistently high interest rates, which continue to pile the pressure on. Many firms are seeing the costs of servicing debts escalate.”

Original artice – https://business-live.co.uk/all-about/yorkshire-humber

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Business distress rising in Yorkshire and Humber areas, report says

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