More than 2,000 small retailers filed for insolvency in the 12 months to Q2 2018, while individual insolvencies have reached its highest quarterly level for six years.

The findings form part of the Insolvency Service’s new official statistics report.

In total, some 0.49 per cent of all active companies entered into liquidation during the 12 months recorded.

Most at risk during this period were companies in the construction, wholesale and retail sectors, followed by transportation and storage, accommodation and food services and manufacturing.

Commenting on the research, the Federation of Small Businesses (FSB) said small retailers are up against “a perfect storm”.

Mike Cherry, FSB National Chairman, explains that businesses face an upwards battle with rising employment costs, increasing business rates and higher than expected inflation.

“Some will have benefited from greater consumer spending throughout the World Cup and a scorching summer. For too many though, this hasn’t proved enough to survive on our high streets, where mounting operating costs are the norm,” he said.

Mr Cherry added that ongoing trading conditions also risk the wellbeing of the high street. For example, cuts to cash machine funding and the loss of bricks and mortar bank branches are hurting footfall, and by consequence, sales.

The FSB also fears for the livelihood of self-employed business owners. The Insolvency Service research shows that almost 1,000 freelance or self-employed individuals suffered bankruptcies in the first three months of 2018 alone.

“The self-employed community, now 4.8 million-strong, is still denied basic support in too many areas. It’s time for the Government to deliver statutory paternity and adoption allowances for these strivers,” said Mr Cherry.

The next round of Insolvency Service statistics is due to be published in October 2018.

Categories: SMETax