But we’ve given it a go anyway
Whether it’s the weather, personal fortunes (Astrology) or putting your money where your expertise is and betting on sports results – everybody likes being asked what, in their opinion, is going to happen in the future.
Our industry is no different and there’s been a lot of coverage this week following a survey conducted by Atradius, who are a trade credit insurer.
Among the main headlines getting attention are that they predict UK business insolvencies to rise to 27% this year – slightly higher than the global average of 26%.
Due to the Covid-19 pandemic, lockdown, gradual easing and Brexit uncertainty they also expect the UK to have the largest GDP contraction in Northern Europe. They predict that as the global GDP will reduce by 4.5%, every global market will see a subsequent rise in business failure except China with Turkey seeing a rise of 41% and the USA with 39% respectively.
They predict that the UK recession will be more acute in magnitude than the “great recession” of 2009 and that the depth and length will be determined primarily by the ability of economies to manage health regulations and either achieve a prolonged and permanent exit from lockdown or “find a way to thrive with social distancing.”
As we’ve written previously, this flies in the face of the official UK insolvency statistics so far in 2020 with statistics from the first half of the year showing historic lows – down 20% year-on-year.
Atradius chief economist John Lorie said: “Government measures have reduced the anticipated increase in bankruptcy filings in a range of ways.
“They have either shifted the threshold for filing, reduced debtor’s ability to force bankruptcy, or provided sufficient financial support to delay filings. However as the support programs begin to expire, the number of filings should climb rapidly.”
It’s quiet. Too quiet.
The most dangerous time in a tsunami is just before the full force of the wave hits the shore.
There’s an eerie calm as everything appears normal and then the water appears to recede as the tide goes out, slowly at first but then gaining momentum until people begin to wonder where the water is.
They’re not wondering for long as it soon reappears as an irresistible force, sweeping all before it away in a torrent of destruction and devastation.
We’re not in the business of scaring people but we think that by Halloween the number of businesses running into financial difficulties will definitely begin to rise and the numbers might be frightening.
The artificial brakes put on insolvencies such as stays on action and moratoriums are being withdrawn so this is the equivalent period to the tide beginning to go out to join the impending deluge.
This is the perfect time to get some advice about how you can keep your company’s head above water if you’re struggling or think you could be in the near future.
Get in touch with us and we’ll quickly arrange a free initial, virtual consultation at a convenient time to get things started.
Our expert advisors can quickly identify underlying issues and recommend remedies that could make the difference between surviving and going under.
We can also conduct a Business Viability Review where we will give an expert opinion backed up by professional financial forecasts using real data and evidence, on how likely a business is to survive and succeed in the next six to twelve months.
However we can help you be in no doubt that a storm is coming. It’s your duty to prepare for it as best you can but the time to do it is now.