ICSM Insolvency News in Brief: Bridal chain falls flat; inflation remains in double figures; large legal firm crashes; huge rise in firms going bust; packaging firm falls into administration
By Harry Mottram: The numbers of businesses going bust continues to rise as a toxic mixture of inflation, high interest rates and an economic slowdown forces more firms to shut up shop. Companies House has released March’s statistics revealing there was a total of 2,457 registered company insolvencies across England and Wales with a 9% rise in creditors voluntary liquidations year or year, 288 compulsory liquidations – that’s 50% up – administrations up 12% and company voluntary arrangements 44% hike compared to March 2022. The total numbers represent a 16% rise in insolvencies year on year in England and Wales, and a 21% increase in Scotland. Northern Ireland is the only part of the UK where business failures have fallen.
The UK arm of a USA bridal firm that has gone bust has fallen into administration. The bridal fashion chain David's Bridal, has 150 staff and a small number of stores in England but hopes to keep trading while a new owner is found. In a crowded market the American business has been hit by the usual problems of debt, a falling demand for fashion and clothing and dare we say a drop in the numbers getting hitched.
Printing billions of pounds better known as Quantitative Easing to stimulate is one of the reasons being blamed on inflation staying stubbornly in double figures. The latest figure is 10.1% for March. It’s the reason why there are so many strikes as workers demand their wages keep abreast of rising prices and a rise in business closures. The Consumer Prices Index from the ONS shows household bills such as utilities has risen by 26.1% with food and drink at 19.1% with restaurants and hotels seeing an 11.3% hike. Many of the kitchen staples such as milk, cheese and sugar have seen far higher rises – so it is no surprise household spending is down. With interest rates pushing up loan repayments and mortgages there is no disguising the problems in the economy – including the enemy of business: inflation.
The largest legal outfit in London is reported to be on the verge of entering administration. Formed 150 years ago, The Ince Group LLP (formerly known as Gordon Dadds Group) employs 700 staff and is yet to publish its financial reports for last year. It is reported in company Rescue that its accounts had been in a protracted audit, and it was in talks with the taxman and a lender over its future. Based in Aldgate the company the firm has held a fire sale of some of its companies and has blamed a cyber attack for causing many of its problems.
ICSM has many printing and packing firms as members. It has seen a huge change in the print industry as paper products have become less popular with the rise of the internet. Packaging however has seen a boom. Which is why eyebrows have been raised on the news that FRP Advisory are seeking a buyer for iTEC Packaging. The packaging company fell into administration this month with liabilities of £16.3 million pounds having made a pre-tax loss of £1.5 million in 2021. The UK firm with plants in Chester-Le-Street and Mansfield specialise in plastic packaging.
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