More big companies set to collapse in 2024, industry experts warn

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Insolvency experts predict a surge in business failures in 2024, citing high borrowing costs and economic challenges, especially impacting tech, construction, and retail.

via Yahoo:

“More big firms are likely to go bust next year amid the “double whammy” of high borrowing costs and pressure on consumer budgets, according to insolvency experts.

Administrators and restructuring specialists also warned the PA news agency that high-growth companies such as tech firms could be among those facing financial turbulence.

It comes after another year of tough economic conditions resulted in increased business failures during the year.

Official figures from the Insolvency Service earlier this month showed the total of company failures over the first 11 months of 2023 was more than reported during the entirety of 2022.

PwC’s head of insolvency David Kelly said both the construction sector and business services industries each saw almost a fifth of total insolvencies.

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He said he therefore expects these areas to “remain the hardest hit in 2024”.

Hospitality and retail have also contributed to business failures as they have been impacted by higher energy prices, pressure on consumer finances and borrowing costs.

Around 17% of all insolvencies have come from the hospitality sector and 14% have come from retailers.

This included high-profile failures such as the administration of Wilko, which had operated 400 shops and employed more than 12,000 workers.”

 



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