Insolvencies and Retailers Amid Uncertainty

  • Number of companies in administration up by 5% in 2019
  • KPMG analysis shows 1,403 companies went into administration in 2019 compared to 1,341 in 2018
  • Third quarter saw a spike in insolvencies with 420 firms going into administration
  • Retailers falling into administration dropped from 170 in 2018 to 133 in 2019
  • Final quarter saw insolvencies return to typical levels with 311 administrations between October and December
  • Greetings card retailer Clintons, Toto Energy, and women’s fashion chain Bonmarche among notable cases
  • Political and economic uncertainty in 2019 affected businesses
  • Business confidence improved after December’s election result
  • KPMG advises companies to focus on financial housekeeping, cash flow management, and operational efficiencies

According to a KPMG analysis, the number of companies falling into administration in England and Wales increased by nearly 5% in 2019. A total of 1,403 firms went into administration compared to 1,341 in the previous year. The third quarter saw a spike with 420 firms going into administration, including Jack Wills, Karen Millen, Late Rooms, and Eversmart Energy. However, the number of high street retailers falling into administration dropped from 170 in 2018 to 133 in 2019. The final quarter saw insolvencies return to typical levels with 311 administrations between October and December. KPMG attributed the rise to political and economic uncertainty, but noted that business confidence has improved after the December election result. They advise companies to focus on financial housekeeping, cash flow management, and operational efficiencies.

Factuality Level: 8
Factuality Justification: The article provides accurate information from KPMG’s analysis, cites specific examples and includes expert commentary on the situation.
Noise Level: 3
Noise Justification: The article provides relevant information about the increase in company administrations in England and Wales in 2019, with specific examples and insights from an expert. It also offers advice for businesses to maintain financial stability. However, it could benefit from more analysis of long-term trends or possibilities and a broader discussion on the factors contributing to the rise in insolvencies.
Financial Relevance: Yes
Financial Markets Impacted: Insolvencies and administration of companies
Financial Rating Justification: The article discusses an increase in the number of companies falling into administration, which can have an impact on financial markets as it indicates potential financial instability or poor performance of these companies. Additionally, it mentions a decrease in insolvencies in the final quarter after the December election result, suggesting a positive effect on business confidence.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification:

Reported publicly: www.retailsector.co.uk