The latest Insolvency Index from Experian has shown a widening north versus south business failure divide, with southern firms faring far better than those in the north.
London and the South East of England saw insolvency rates fall between October and November, while company failures increased in the North East, North West and Yorkshire.
During November, insolvency rates were highest in the North West (0.14%), North East (0.12%) and Yorkshire (0.11%). By comparison, the South East, South West and Greater London recorded failure rates of 0.07%, 0.08% and 0.08% respectively.
Across the country, there was a small month-on-month improvement in the rate of business insolvencies, from 0.10% in October to 0.09% in November. Out of the UK’s business population, this represents 1,736 firms failing in November. In November 2010, the insolvency rate 0.07%.
The average financial strength of businesses in the UK deteriorated by 0.5% in November, falling to 78.07 from 78.44 in October. In November 2010, the average financial strength score was 81.31.
Max Firth, managing director for Experian’s Business Information Services division in the UK & Ireland, said: “The latest insolvency index highlights that some businesses continue to need to assess the risk strategies they have in place very carefully. They need first to understand the risks they are exposed to and then protect themselves from debt that could be detrimental to their business on a regular ongoing basis.”””