Latest news with #BegbiesTraynor
Scotsman
a day ago
- Business
- Scotsman
Scottish businesses see escalating early financial distress as economic uncertainty continues
As the UK economy struggles to find growth in the face of ongoing global turmoil, the latest data from leading independent business rescue and recovery specialist Begbies Traynor shows that in the second quarter of 2025 levels of Scottish businesses experiencing the first signs of financial distress rose both since the previous quarter and also compared with the same period the previous year. Sign up to our daily newsletter Sign up Thank you for signing up! Did you know with a Digital Subscription to Edinburgh News, you can get unlimited access to the website including our premium content, as well as benefiting from fewer ads, loyalty rewards and much more. Learn More Sorry, there seem to be some issues. Please try again later. Submitting... Providing a quarterly snapshot of Britain's corporate health, the Red Flag Alert data for Q2 2025 revealed that instances of early or 'significant' business distress in Scotland had grown by 9.1% since the first three months of the year and by 2.7% since Q2 2024. With 31,251 Scottish firms now affected, signs of early-stage financial problems also rose across the UK as a whole, increasing by 15.1% quarter-on-quarter and by 10.8% year-on-year with a national total of 666,876 businesses feeling its impact. Almost all sectors in Scotland saw increases in significant distress in the second quarter of 2025 compared with the previous three months, with nine of the 22 industry categories monitored by Red Flag Alert experiencing double digit growth. Among the worst affected were: printing and packaging (+21.7%); bars and restaurants (+15.3%); professional services, and food and drugs retailers (both +15.2%). Advertisement Hide Ad Advertisement Hide Ad In contrast, the only sectors in Scotland to see a quarter-on-quarter fall in significant distress were: manufacturing (-12.1%); automotive (-6.7%); food and beverages (-3.1%); and sports and health clubs (-1.6%). Ken Pattullo of Begbies Traynor in Scotland Ken Pattullo, managing partner for Begbies Traynor in Scotland, said: 'Businesses here in Scotland, and indeed across the UK, are continuing to operate in extremely difficult conditions as we face a number of global conflicts together with the challenges of Trump's ever-changing international trade war. The most important factor for business success is certainty and, unfortunately, over the last five years or so, there has been very little of that, making long-term planning tough and further damaging confidence.' In addition to the growth in early business distress, instances of advanced or 'critical' financial distress, both in Scotland and across the UK, also revealed a bleak picture. A total of 2,347 Scottish businesses experienced this type of distress, representing an increase of 7.2% since the previous quarter and a rise of 15.6% compared with the second quarter of 2024. This was reflected nationally with a quarter-on-quarter increase of 8.6% and a year-on-year rise of 21.4%, with 49,309 businesses affected across the UK. Looking at critical distress in Scotland, all but six of the sectors saw increases compared with the same period the previous quarter – professional services was most severely hit with a rise of 58.8%, followed by bars and restaurants which rose by 50.4%. The strongest performing sectors were: printing and packaging (-62.5%); manufacturing (-38.2%); leisure and culture (-37.8%); health and education (-24.6%); and general retail (-11%). Advertisement Hide Ad Advertisement Hide Ad Mr Pattullo continued: 'With employers struggling under the dual burden of increased national insurance contributions and a rise in the national living wage both introduced earlier this year, as well as inflation remaining above target levels, increasing numbers of businesses are struggling for survival rather than seeing much longed-for growth. Business owners would be well advised to keep a very close eye on their finances and seek professional support at the first sign of problems when advisers will have more tools available to help them to prevent problems from escalating.'
Yahoo
a day ago
- Business
- Yahoo
SME Construction data casts doubt on UK ability to hit 1.5 million homes
The number of struggling construction firms has risen further despite heavy pressure on the sector to deliver hundreds of thousands of new homes. The number of firms in critical distress – a measure of firms nearing bankruptcy – rose 15.8 per cent in the second quarter of 2025, according to Begbies Traynor, while the number of construction firms in critical and significant financial distress topped charts in the first quarter, at 6,830 and 97,603 firms respectively. 'SMEs are grappling with a range of cost pressures, including strict environmental regulations and burdensome taxes on employers. These cost pressures are making it increasingly harder – not easier – to build,' Steven Mulholland, CEO of the Construction Plant-hire Association (CPA), said. The industry was the slowest growing sector of the UK economy in the first quarter of 2025, and total construction output stagnated in this period – ending three consecutive quarters of growth as activity across real estate softened. 'Employer National Insurance hikes have already hit jobs and investment. Now, looming changes to Business Property Relief risk being the final blow – threatening 200,000 jobs and £15 billion to the economy, and punishing the very firms Britain needs to deliver growth, infrastructure and homes,' Mulholland added. 'Without urgent reform, we won't just miss housing targets – we'll lose the wider supply chain capable of building the vital infrastructure Britain needs,' he said. Construction firms in 'a difficult position' Kelly Boorman, National Head of Construction at RSM UK, has warned that the combination of high financial distress in the industry and the government's housing push puts the sector in a tough place. The government has pledged billions to support housebuilders, something which has been largely helped by the industry, but Boorman warned business could fall into an 'overtrading trap'. 'There's the risk [they]… take on more work than their supply chains and operational capacity can support,' Boorman said. 'Mandatory housing targets and expectations to commit to large infrastructure projects could result in businesses being unable to meet demand, despite the government's commitment to investment, training and pipeline visibility,' she added. Experts have warned that there are still significant planning and delivery challenges that developers are facing alongside cost pressures, including skills shortages – despite recent investments – wage inflation, raw materials shortages and inflation.
Scottish Sun
2 days ago
- Business
- Scottish Sun
Fifty thousand businesses on brink of collapse over ‘immense strain' of rising wage costs
Those in 'significant' financial distress increased by ten per cent over the year 'CRITICAL' LEVELS Fifty thousand businesses on brink of collapse over 'immense strain' of rising wage costs FIFTY thousand businesses are on the brink of collapse as rising wage costs put them under 'immense strain', a report reveals. The number in critical financial distress has risen by more than a fifth compared with a year ago. Advertisement 2 The British Beer and Pub Association warned 378 pubs would close this year in England, Wales and Scotland Credit: Getty Chancellor Rachel Reeves' increases in National Insurance costs and the minimum wage are seen as key reasons, the Begbies Traynor survey shows. Bars and restaurants at 'critical' financial level were up by 41 per cent. And there was a 39 per cent rise among travel and tourism companies. The total number hit 49,309. Advertisement Those in 'significant' financial distress increased by ten per cent over the year to 666,876. Shadow Chancellor Mel Stride said: 'Labour's reckless Jobs Tax is pushing thousands of small businesses to the brink. "The lifeblood of local communities are paying the price.' Ric Traynor, of Begbies Traynor, said: 'Small and medium-sized businesses across the UK are being put under immense strain by the recent increases to employer's NI and the national minimum wage.' Advertisement The British Beer and Pub Association warned 378 pubs would close this year in England, Wales and Scotland. The BBPA's Emma McClarkin said: 'We're calling on government to fulfil promises of business rates reform, mitigate costs and cut beer duty.' 2 The number of businesses in critical financial distress has surged by over 20% — with Rachel Reeves' hikes in National Insurance and minimum wage blamed Credit: PA
The Sun
2 days ago
- Business
- The Sun
Fifty thousand businesses on brink of collapse over ‘immense strain' of rising wage costs
FIFTY thousand businesses are on the brink of collapse as rising wage costs put them under 'immense strain', a report reveals. The number in critical financial distress has risen by more than a fifth compared with a year ago. 2 Chancellor Rachel Reeves' increases in National Insurance costs and the minimum wage are seen as key reasons, the Begbies Traynor survey shows. Bars and restaurants at 'critical' financial level were up by 41 per cent. And there was a 39 per cent rise among travel and tourism companies. The total number hit 49,309. Those in 'significant' financial distress increased by ten per cent over the year to 666,876. Shadow Chancellor Mel Stride said: 'Labour's reckless Jobs Tax is pushing thousands of small businesses to the brink. "The lifeblood of local communities are paying the price.' Ric Traynor, of Begbies Traynor, said: 'Small and medium-sized businesses across the UK are being put under immense strain by the recent increases to employer's NI and the national minimum wage.' The British Beer and Pub Association warned 378 pubs would close this year in England, Wales and Scotland. The BBPA's Emma McClarkin said: 'We're calling on government to fulfil promises of business rates reform, mitigate costs and cut beer duty.' 2
Daily Mail
2 days ago
- Business
- Daily Mail
Reeves's tax hikes leave 50,000 firms on the brink as stagflation fears grip Britain
The High Street has suffered a tenth consecutive month of decline as higher prices hit shoppers – fuelling fears Britain is facing a painful period of stagflation. In a bleak update, the CBI said its gauge of how retail sales compared with a year earlier stood at minus 34 this month as customers baulked at rising living costs. Although that was better than minus 46 seen in June, it was the tenth month of decline in a row, stretching back to October last year, according to the lobby group's figures. The slump came as firms battered by the Chancellor's £25billion National Insurance tax raid and an increase in the minimum wage pushed up prices – hitting customers in the pocket. The High Street is also grappling with higher business rates following Labour's failure to reform the hated levy on shops and other business properties. The CBI report sparked fresh concerns over the state of the economy as corporate restructuring specialist Begbies Traynor warned a record number of companies are in 'critical financial distress'. Its 'Red Flag Alert' found there are 49,309 firms on the brink – up 21.4 per cent on a year ago. Begbies said 'consumer-facing industries continued to experience some of the most extreme rises in critical financial distress' and highlighted a 41.7 per cent rise among bars and restaurants and a 17.8 per cent increase in general retail. A host of household names have been hit, with River Island battling for survival following the collapse of maternity brand Seraphine and fashion chain Quiz. It is feared Rachel Reeves will hammer households and private business again with another round of tax hikes in the Budget this autumn to pay for Labour's lavish spending on the public sector. The rising costs faced by business have already pushed up inflation to 3.6 per cent – well above the 2 per cent target – while the economy has also contracted for two months in a row. That has raised the spectre of stagflation – a period of economic stagnation and inflation that hits living standards and costs jobs. It has also cast doubt over how far and fast the Bank of England can cut interest rates this year. The CBI urged ministers to 'seek to build shorter-term confidence' in the Government's economic plans and deliver an autumn Budget 'that acknowledges the burden firms are facing'. Cautioning over the impact of the new workers' rights Bill, Martin Sartorius, principal economist at the CBI, said: 'Firms reported that elevated price pressures – driven by rising labour costs – and economic uncertainty continue to weigh on household demand.'
