Over 25 percent (26%) of UK companies have suffered a hit to the finances adopting the insolvency of any customer, supplier or debtor in the last six months time, in accordance with advantages . from R3, the insolvency and restructuring trade body.
The research found the financial impact on the insolvency of one other business was named “very negative” by one in ten UK companies (10%), in addition to being “somewhat negative” by 16% of respondents.
The figures are evidence of the so-called ‘domino effect’, where one company’s insolvency will heighten the insolvency risk for other people.
In Q1 2018, after having a spate of well-known insolvencies involving large companies like Carillion or Toys r us, underlying insolvencies climbed 13% from the previous quarter.
Andrew Tate, spokesperson for R3, says: “No business exists in isolation, each headline-grabbing corporate insolvency may have consequences for numerous other enterprises. Within the worst-case scenario, the losing of a significant method of trading could lead to a company’s own insolvency consequently
