THE latest figures from Scotland’s insolvency service have revealed 94 company insolvencies registered in the country in February, 9% higher year-on-year.
This was comprised of 33 compulsory liquidations, 58 creditors’ voluntary liquidations and three administrations.
Michelle Elliot, restructuring advisory partner at FRP in Glasgow, said: “After last month’s dip in insolvency levels, numbers are rising once again. Indeed, the long-term picture is that firms burdened by debt or who were deeply impacted by the effects of the pandemic are struggling to re-establish a foothold in the face of persistently weak consumer demand and high interest rates.
“Instead of fresh starts, April’s new tax year will bring a new hurdle for Scottish businesses in the form of a rise in the National Living Wage, which will increase every firm’s wage bill. While borrowing and trading conditions will eventually improve as inflation eases, conditions are still likely to be challenging for some time to come. Companies will need to remain vigilant when it comes to their financial health, plan to address any particular pressure points – known and unknown – and be ready to take quick, proactive action at the first sign of difficulty. In our experience, early action always leads to the best results.”
