Businesses have been told not to panic after it was revealed that corporate insolvencies in England and Wales are at the highest level for five years.
According to the figures released by consultancy firm PricewaterhouseCoopers the number of corporate insolvencies was up by 21% in the first quarter of 2008 compared with the last quarter of 2007 and 17% when likened to the same period last year.
The raw numbers are frightening – in total, 3,359 businesses across England and Wales entered into insolvency in January, February and March. This is the highest number of insolvencies since the fall-out from the dot-com crash in 2003.
Despite this, Mike Jervis, partner in the business recovery services practice at PricewaterhouseCoopers, urged businesses not to panic “but to ensure they are doing all they can to manage their way through the potential downturn as soon as they see signs of financial distress.”
Jervis said that companies must have a strategy in place if they are to weather the storm. “History has shown that the companies who emerge from the downturn as sector leaders will be those who proactively undertake a strategic, financial and operational review now.”
© Crimson Business Ltd. 2008
