As the UK’s economic situation continues to deteriorate, businesses in Yorkshire face a front-line battle against invoice late payment. Many Yorkshire based Businesses are starting to show signs of increasing financial problems. This is due to larger amounts of debt being owed and increasing numbers of businesses failing to pay invoices.
Yorkshire is the biggest county in the UK. It is over twice the size of Lincolnshire, the nations second biggest county. It is the hone to large cities such as Leeds, Sheffield and Bradford.
According to latest research from insolvency and restructuring trade body R3 which was based on an analysis of data provided by CreditSafe; the region has seen a steady rise in the debts owed by companies in liquidation over the last four months.
There has been a 90% increase, rising from 120 companies in December 2021 to 228 in April. This represents just under £1.4m of debt owed last December which increased to £2.4m last month.
The growing bad debt figures in Yorkshire and Humberside were reflected across much of the UK with four other regions seeing even higher numbers of debts owed by companies in liquidation: Greater London (354); North West (280); West Midlands (270); and South East (243).
Looking at another indicator of worsening financial distress, late payment of invoices, R3’s analysis of the CreditSafe data also showed continuing problems with this issue as around 51,000 companies in Yorkshire and Humberside once again proved unable to meet their payments on time in April.
Late payments have remained at this level in the region over the last few months and insolvency experts fear that this will have a knock-on effect on suppliers as they struggle to settle their own bills on time due to unpaid invoices.
Eleanor Temple, chair of R3 in Yorkshire and a barrister at Kings Chambers in Leeds, comments: “After two very tough years for businesses, unfortunately, the economic prospects look far from encouraging with energy prices soaring, rising inflation and living standards being squeezed.
“We are once again hearing economists talk of stagflation and, with the shadow of another recession appearing to be getting closer, we are already seeing growing signs of pressure on businesses here.
“Amid the backdrop of weak economic growth as the Ukraine crisis looks set to continue, businesses would be well advised to keep a close eye on their cash flow, particularly given the high number of late payments in the region. In addition, since December, we have also seen growing levels of debt with almost double the number of companies in liquidation owing creditors.
“With living standards expected to take their biggest hit for decades, consumer spending is likely to fall, impacting almost every sector, and we urge businesses to seek professional advice at the first signs of financial problems when more options will be available to them.”
Businesses in Yorkshire are being urged to take action where invoices go unpaid. There are many debt collection options available to small businesses and SME’s in the county. Debt Collection Agencies in Leeds and Debt Collection in Sheffield have helped bolster the county’s economy over the years and is expected to help turn the corner on this latest problem.
The use of Debt Collection Agencies has been on the rise since the end of the pandemic and more so since the end of insolvency restrictions. Hiring a debt collection agency in the uk has never been easier to do.
The courts have been clogged up with a backlog of county court claims since the end of covid with Small Businesses and SME’s wanting to recover monies owed to them. This latest news is expected to ignite a procession of Businesses across the UK into taking action.