Warning for directors as more than 10,000 Lancashire companies on the brink

By Begbies Traynor

21 Jan 2021

ian-mcculloch-of-begbies-traynor.jpg

More than 10,000 businesses in Lancashire are now in significant financial distress, according to new research published today by Begbies Traynor. 

The latest Red Flag Alert research for Q4 2020 has recorded 10,863 businesses in ‘significant distress’. This 8% increase (from 10,034 in Q3 2020) comes as the regional economy battles the third nationwide lockdown. 

The research also confirms a 25% year-on-year increase in significantly distressed companies since Q4 2019 (8,696 - Q4 2019, 10,863 - Q4 2020).

Distress in the industrial transportation sector increased by 48% (from 210 in Q4 2019 to 310 in Q4 2020), real estate and property services saw an increase of 33% (907 to 1,208) and distress for hotels and accommodation increased by 40% (113 to 158). 

Every single one of the 22 sectors monitored by the Red Flag Alert research exhibited an increase in significant distress, with 7 sectors experiencing double digit increases in the final quarter of 2020 - a worrying sign for the regional economy.

Ian McCulloch, partner at Begbies Traynor in Preston, said: “These figures highlight the deteriorating financial situation for many companies across our region. Without the financial aid and support measures that the Government has put in place during the pandemic insolvency levels would have been much higher. The sad truth is that for many companies this will provide little more than a stay of execution as debt levels become unmanageable and structural changes across many sectors take their toll.

“A national lockdown policy with no concrete end in sight does little to help worried business owners and their finance directors.

“The pandemic has actually reduced court activity by limiting the number of CCJs and winding up petitions being issued against indebted companies and there has been a ban on winding up petitions for Covid-related debts so the situation could get even worse when the courts eventually open up fully.

“Company directors who are running a distressed business must explore all their restructuring options now if they are to survive. Getting together a proactive creditor strategy, fresh re-financing package or a tax efficient disposal of the business needs to be high on the boardroom agenda to survive the weeks and months ahead. 

“The roll-out of the vaccine offers some light at the end of tunnel but the financial situation for many businesses will remain bleak over the next quarter and beyond," added McCulloch.

Latest news

1

Supermarket stays put in blow to town's £250m masterplan Blackburn Aerial

Supermarket stays put in blow to town's £250m masterplan

28 Mar 2024

2

Modern Milkman acquires American counterpart article placeholder listing image

Modern Milkman acquires American counterpart

28 Mar 2024

3

Tips for surviving Lancashire's pothole plague

Tips for surviving Lancashire's pothole plague

28 Mar 2024

4

The Pikes wines launched to support Lake District mountain rescue THE PIKES BLOG BANNER.jpg.jpg

The Pikes wines launched to support Lake District mountain rescue

28 Mar 2024

5

Fundraising success sees Stanley Women compete in Dallas Cup The Accrington Stanley Under 18s team which are currently in Dallas.jpg.jpg

Fundraising success sees Stanley Women compete in Dallas Cup

28 Mar 2024

Hwc 2024 Email Signature 980x120
Background image for hub sign up block

LBV Hub

Reach 50,000 members of the Lancashire business community

Post your news
Post your events
Post your offers
Company profile
Social reach
Magazine coverage
Sign-up
Events
Health and Wellbeing Conference 2024
Hwc 2024 Social Media 1200px 1
Networking
23 Apr 2024

Health and Wellbeing Conference 2024

Crow Wood Hotel, Burnley , BB12 0RT

08:30 - 13:00

Business Networking in Preston - BNI Brunch
EVENT LISTING SIZING Brunch .png.png
LBV Hub Networking
29 Mar 2024

Business Networking in Preston - BNI Brunch

Samlesbury Preston Hotel, Preston New Road, Preston, PR5 0UL

09:30 - 11:00

Business Networking in Blackburn - BNI Infinity
EVENT LISTING BNI Infinity.png.png
LBV Hub Networking
29 Mar 2024

Business Networking in Blackburn - BNI Infinity

Hampton by Hilton, 2 Frontier Ave, Blackburn, BB1 3AL

06:30 - 08:30

Business Networking in Chorley - BNI Endeavour
EVENT LISTING SIZING Endeavour.png.png
LBV Hub Networking
02 Apr 2024

Business Networking in Chorley - BNI Endeavour

Oak Royal, Bury Lane, Chorley, PR6 8SW

06:30 - 08:30

Business Networking in Blackburn - BNI Vista
EVENT LISTING SIZING Vista.png.png
LBV Hub Networking
02 Apr 2024

Business Networking in Blackburn - BNI Vista

Hampton by Hilton, 2 Frontier Ave, Blackburn, BB1 3AL

06:45 - 08:30

Business Networking in Preston - BNI Diamond
EVENT LISTING BNI Diamond.png.png
LBV Hub Networking
03 Apr 2024

Business Networking in Preston - BNI Diamond

The Marriot Hotel, Garstang Road, Broughton, PR3 5JB

07:15 - 09:00

Business Networking in Lancaster - Eden Business Network
EVENT LISTING Eden Business Network.png.png
LBV Hub Networking
03 Apr 2024

Business Networking in Lancaster - Eden Business Network

The Borough, 3 Dalton Square, Lancaster, LA1 1PP

18:30 - 20:30

Business Networking in Accrington - BNI Zeus
EVENT LISTING SIZING Zeus.png.png
LBV Hub Networking
03 Apr 2024

Business Networking in Accrington - BNI Zeus

The Mill House, Corn Mill Yard, Accrington, BB5 5HX

06:45 - 08:30

Business Networking in Burnley - BNI Kudos
EVENT LISTING BNI Kudos.png.png
LBV Hub Networking
04 Apr 2024

Business Networking in Burnley - BNI Kudos

Prairie Sports Village, Windemere Avenue, Burnley, BB10 2FU

06:45 - 08:30

Business Networking in Lancaster - BNI Castle
EVENT LISTING BNI Castle.png.png
LBV Hub Networking
04 Apr 2024

Business Networking in Lancaster - BNI Castle

Vale of Lune RUFC, Powder House Lane, Lancaster, LA1 2TT

06:45 - 08:30

Business Networking in Blackburn - BNI Infinity
EVENT LISTING BNI Infinity.png.png
LBV Hub Networking
05 Apr 2024

Business Networking in Blackburn - BNI Infinity

Hampton by Hilton, 2 Frontier Ave, Blackburn, BB1 3AL

06:30 - 08:30

Business Networking in Preston - BNI Brunch
EVENT LISTING SIZING Brunch .png.png
LBV Hub Networking
05 Apr 2024

Business Networking in Preston - BNI Brunch

Samlesbury Preston Hotel, Preston New Road, Preston, PR5 0UL

09:30 - 11:00

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more Lbv115 Online Graphic
Subscribe now

Weekly news bulletin