Firm news

Happier New Year!

2009 will officially be remembered as the year of doom and gloom with staples such as Woolworths, Land of Leather and Barratt Shoes disappearing from the British high street earlier this year and with Borders tills ringing for te final time with the last "everything must go sale" stakeholders must be hoping and praying that better times are ahead in 2010.

Forecast of 2010

Any optimisation was soon dashed after chancellor, Alistair Darling's pre budget report yesterday, where he confirmed that the recession was worst than predicted with the UK economy shrinking by 4.75% in 2009 compared with April's estimate of 3.5%.

Top London Insolvency firm Begbies Traynor estimate that in 2010 as many as 50,000 firms in the UK would become insolvent along with another 50,00 in 2011. This is a steep increase from the estimated 32,000 firms which became insolvent this year.

Begbies Traynor commented that the recession, instead of being V shaped is more likely W shaped and that we should brace ourselves for the second fall of the W. Expert Nick Hood said that "now is the most dangerous time for businesses because as the economy improves firms cannot get hold of working capital meeting higher demands. The story of 2010 will be businesses failing not because of recession but because of the recovery".

Hood also commented that the "carnage would be among small and medium sized businesses, good old owner managed salt-of-the-earth, engine-room-of-the-economy companies".

Better Abroad?

The misery unfortunately doesn't just stop at our shores, with the once impenetrable, Babylonian-esc Dubai seeing a fall in there stock market for the second day as fears continue about companies being able to repay debts.

On a more positive note restaurant and deli chain Carluccios do not seem to have this problem with the announcement that two more branches will be opened in Dubai after the success of the first branch which opened in March this year!

If you company or client is experiencing financial difficulty please contact Lydia Scally in our Insolvency and Business Recovery and Restructuring department.

For more information please click on the following link: Insolvency and Business Recovery and Restructuring