Business failures fell by 12.1 per cent in 2010 compared to 2009, according to credit reference agency and business information provider Equifax. The firm has released its final “Business Failures” report for 2010, which it says paints a relatively positive picture for UK businesses.
For the last quarter of 2010, according to the Equifax analysis, year-on-year the trend of reduced numbers of businesses going under was maintained. In comparison to Quarter 3 the numbers increased slightly.
Business failures dropped 8.4 per cent year-on-year in Quarter 4 2010 but there was a 6.4 per cent increase in failures in the last three months of the year compared to Quarter 3.
However, Equifax downplayed this trend, pointing out that the numbers are still lower than seen at the beginning of 2010.
“What we have seen throughout 2010 is a steady drop in the number of organisations failing,” said Neil Munroe, external affairs director at Equifax. “But of course the big question is what is in store for businesses in 2011.
“When we look at the pattern of failures over the last seven years, we can see that we are not yet back to the numbers before the recession. There were just under 23,000 failures in 2010 compared to 19,000 in 2007.
“However, the quite significant year-on-year drop of 12.1 per cent, from 26,000 in 2009, should give business and industry a certain amount of confidence that, as long as they continue to do the things they have been doing in 2010, they should be able to survive.”
In the regions the strongest performers year-on-year for Quarter 4 2010 were Scotland and the East Midlands with 23.1 per cent and 17.9 per cent drops in failures respectively. Wales was the only region that saw an increase in failures year-on-year – up by 3.5 per cent.