In business, companies often experience fluctuations in performance and face various challenges. However, distinguishing between temporary setbacks and a persistent decline is crucial for business owners and stakeholders. Recognizing the early warning signs of a company in decline allows for timely intervention and strategic decision-making. In this article, we will explore key indicators to identify a company in decline, ranging from business performance and staff morale to reputation, market perception, financial distress, and cash flow crisis.

Key indicators to identify a company in decline

1. Business Performance: One of the most evident signs of a company in decline is a consistent decline in business performance. This decline can manifest through decreasing sales revenue, declining profits, eroding market share, or diminishing customer retention. Key performance indicators (KPIs) such as sales growth, profit margins, and customer satisfaction scores can provide valuable insights into a company's trajectory.

2. Staff Morale: Employee morale is a reflection of the overall health of a company. A decline in staff morale is often linked to several factors, including uncertainty about the company's future, decreased job security, lack of recognition, and poor management. High employee turnover, increased absenteeism, and a general sense of dissatisfaction among the workforce are warning signs that should not be ignored.

3. Reputation: A company's reputation is a vital intangible asset. Decline in reputation can stem from various factors, such as product quality issues, ethical misconduct, poor customer service, or negative media coverage. A tarnished reputation can lead to a loss of trust among customers, suppliers, and partners, resulting in reduced business opportunities.

4. Market Perception: The way the market perceives a company can significantly impact its performance. A decline in market perception may be indicated by negative reviews, declining brand loyalty, or customers expressing dissatisfaction on social media platforms. Market perception directly affects consumer behaviour, and negative sentiments can lead to reduced sales and revenue.

5. Financial Distress: The financial health of a company is a fundamental aspect of its overall well-being. Warning signs of financial distress include increasing debt levels, declining liquidity, deteriorating credit ratings, and difficulties in meeting financial obligations. Companies facing financial distress may resort to cost-cutting measures, layoffs, or asset sales as desperate measures to stabilize their finances. A financial health check is recommended. Try our checklist here.

6. Cash Flow Crisis: A cash flow crisis occurs when a company lacks sufficient cash inflows to cover its operational expenses and debt obligations. It can be a result of slow-paying customers, a decrease in sales, or poor financial management. A company experiencing a cash flow crisis may struggle to pay its suppliers, meet payroll, or settle outstanding debts on time.

Warning Signs and Early Intervention:

Identifying these warning signs is crucial, and early intervention can prevent the decline from worsening. Here are some proactive steps to address a company in decline:
1. Conduct a Comprehensive Business Analysis: Perform a thorough assessment of the company's financial statements, market positioning, customer feedback, and employee engagement surveys to gain insights into the root causes of the decline.

2. Develop a Turnaround Plan: Create a well-defined and realistic turnaround plan, outlining specific actions to address the identified issues and revive the business. The plan should be based on data-driven insights and focus on sustainable growth. Consult professionals if you need help.

3. Strengthen Leadership and Management: Evaluate the effectiveness of the leadership team and make necessary changes to bring in experienced leaders who can guide the company through challenging times.

4. Engage with Employees: Communicate openly with employees to address their concerns, boost morale, and foster a culture of collaboration and innovation.

5. Rebuild Customer Trust: Invest in improving product or service quality, customer service, and addressing any complaints promptly to regain customer trust and loyalty.

6. Seek Professional Advice: Enlist the help of business consultants, financial advisors, and industry experts who can offer objective perspectives and guidance.

Identifying a company in decline is vital for taking timely action to reverse its course and safeguard its future. By being vigilant about business performance, staff morale, reputation, market perception, financial distress, and cash flow, business owners and stakeholders can address the root causes of decline and chart a path towards sustained growth and success. Proactive measures and decisive decision-making are crucial for transforming a company in decline into a thriving and resilient organization. If the warning signs suggest that the company has passed its use by date, then contact licensed insolvency practitioners for advice on the best way to wind down the company.

In our 34th Insolvency by the Numbers, we look at our data set for August 2023 and past years to see how the month has tracked and what may be coming up in the coming months.

During August we begun to see the political parties get there electioneering into gear and ramp up their campaigns with policy being released left right and centre and billboards going up across the country in every available location.

The latest OCR announcement saw no change to the rate, it did push out the timeline when we may begin to see any future reductions in the rate.

In the insolvency space there was positive news for the Ruapehu ski fields, the construction sector continues to struggle with building consent numbers dropping. The sector also represents 35%-40% of the total corporate insolvency appointments by sector. TopCatch and Pet Central retail stores along with Wishbone cafes all saw themselves entering insolvency processes joined by Epic Breweries and Beer Brothers. On the case law front the long awaited Mainzeal Supreme Court decision was released clarifying further director’s duties.

Company Insolvencies – Liquidations, Receiverships, and Voluntary Administrations

Company insolvency appointments for August 2023 combined across all insolvency types have beaten out all years back to 2019. Compared to the 2022 figures, 2023 is only up 3 appointments at this stage with August 2023 sitting at 181 for the month.

Insolvent Shareholder appointment liquidations have seen a huge jump this month up making up 104 of the total, up 34 on their long term average. Court liquidation while above the long-term average have dropped slightly from their past months highs but continue strongly on the back of steady winding up applications driven by the IRD and its recovery efforts. Of note the solvent liquidation remain below the average perhaps a signal of the current state of the economy as business find themselves struggling rather than selling up for a profit and freeing up the capital to invest elsewhere.

Finally in August total corporate insolvency figures for the year to date have caught up to and overtaken the 2019 figures 1306 to 1290. Of interest the total appointments in 2021 was 1488 and in 2022 1679, at this rate I expect we will exceed total 2021 appointments by the end of September and 2020 & 2022 by the end of October. We have a bit of work to do yet before we are likely to reach 2017/2018 levels but there is a chance it will happen before the end of the year.

While court liquidations have dropped slightly as an overall percentage, they still remain above their long team average, as do insolvent shareholder appointment liquidations which make up a large portion of the below pie, we continue to see a drop in solvent appointments however. Voluntary Administrations and Receiverships remain in line with their long-term averages.

Winding Up Applications

We are back on the climb in August after our slight drop in July. As mentioned last month while it is below June figures it is likely the result of a continued consistent increase in figures evening out compared to the usual spike we see in June/July. So, a longer sustained lift rather than a June/July spike and drop off.

In August, there has been a consistent rise in the number of winding up applications compared to past Augusts. For instance, in August 2021, there were 41 applications, with 16 being company winding up applications and 25 being IRD winding up applications. August 2022 witnessed an increase, with 69 total applications, including 14 company winding up applications and 55 IRD winding up applications. August 2023 continued this upward trend, with 83 applications, consisting of 22 company winding up applications and 61 IRD winding up applications.

Additionally, when considering the year-to-date figures, we observe a continuous increase in the cumulative total of winding up applications. From January to August, the numbers have consistently grown over the years, reflecting a persistent upward trend. This indicates persistent financial challenges faced by companies, leading to a rise in the number of winding up applications as the graph continue its upwards top right corner climb.

From the below graph we continue to see that IRD’s August 2023 winding up applications remain 3x the remainder of all creditors and have continued to grow as an overall percentage month on month since March. Total other company cumulative applications for the year total 250 while the IRD as a sole creditor is streaks ahead on 338 of the total 588 applications in the year to date. Of the 338 applications so far IRD has followed through with placing 192 of them in liquidation or 56% of the total applications so far, their long-term average is 61% ending up in liquidation. The difference is the result of the August applications still a few weeks away from being heard in court but will wash out in the long run.

Personal Insolvencies – Bankruptcy, No Asset Procedure and Debt Repayment Orders.

Personal insolvency appointments remain low and continue looking very similar to 2022 figures. This is not expected to change until the personal guarantees start to get called up by creditors in liquidations (landlords, trade creditors banks etc), and lending taken out on high interest rate loans to meet increasing cost of living catches up with people, often after the Christmas holidays and the first credit card bills come in over February. As a breakdown of appointment types bankruptcies remain above their long term average with both No Asset Procedures considerably below their long term average for the month. Debt Repayment Orders remain around their long-term average for the month.

For the year-to-date total bankruptcies are 318, these are traditionally considered the more complex of the 3 personal insolvency options with both No Asset Procedures and Debt Repayment Orders not involving any assets. As a comparison the Official Assignee has taken 167 liquidation appointments to August 2023, this makes them the largest liquidator of companies in NZ with the next closest sitting at 98 for the year to date. As the default court liquidator when no other liquidators have consented to the appointment the Official Assignee is seeing 34% of their workload coming from court liquidations largely generated by the IRD.

Election Graphs

While there is a lot of focus on the economy and cost of living from all parties and their respective policy’s focusing on it accordingly, the numbers show that total insolvency appointments remain behind the last two elections. This is largely the result of very low personal insolvency appointments and insolvency figures being a lagging indicator for the economy as a whole.

Where to from here?

The signs continue to point to the NZ economy being in for continued pain for the foreseeable future with it likely to get worse before it gets better. The OCR is unlikely to be dropped till mid-2025, the recession continues and inflation just keeps biting.

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Company Insolvencies – Liquidations, Receiverships, and Voluntary Administrations

Company insolvency appointments for July 2023 combined across all insolvency types have come in just under 2019 levels. Court liquidations remain a driver for these increased levels. This increase is following continued strong winding up applications driven by the IRD and its recovery efforts.

As a percentage share of appointments, the figures have remained consistent from last month.

Total corporate insolvency figures for the year to date continued to sit just behind 2019 figures. The slower start to the years insolvency appointments has yet to be recovered from.

While court liquidations have dropped slightly as an overall percentage they still remain above their long team average so remain a large portion of the below pie, we continue to see a drop in solvent appointments however.

Winding Up Applications

The increases seen over the last 3 months have finally pulled back slightly. While it is a drop on the last two months it may be the result of increased figures evening out compared to the usual spike we see in July. So a longer sustained lift rather than a July spike and drop off.

From the below graph we continue to see that IRD’s winding up applications close in on 3x the remainder of all creditors and has continued to grow as an overall percentage month on month since March.

Personal Insolvencies – Bankruptcy, No Asset Procedure and Debt Repayment Orders.

Personal insolvency appointments remain low and continue looking very similar to 2022 figures. As a breakdown of appointment types bankruptcies remain above their long term average with both No Asset Procedures and Debt Repayment Orders below their averages by 10 pts each.

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Company Insolvencies – Liquidations, Receiverships, and Voluntary Administrations

Company insolvency appointments for June 2023 combined across all insolvency types have beaten out all past years shown in the above graph back to 2019. Court liquidations have been a driver for these increased levels showing the highest figures since prior to 2020 with 59 appointments. This increase is following a number of months or stronger than usual winding up applications lead in part by IRD and its recent drive to collect delinquent debtors.

Whether this level of court appointments will continue into the election only time will tell what IRD does, or if shareholder appointments will continue to grow due to an ongoing cost of living crisis and general price increases. It appears unlikely that we will see a miraculous recovery before the end of 2023.

Total corporate insolvency figures for the year to date remain above the last 3 years and have begun to once again pull back 2019 figures with a strong June. For the year to date 2023 is one 21 appointment behind 2019, realistically this is only 2 – 3 days of appointments. 2023 remains a far cry from 2018 which was at 1,111 total appointments for the year to date.

Winding Up Applications

In June, there has been a consistent increase in the number of winding up applications compared to past Junes. In June 2021, there were 83 applications, with 21 being company winding up applications and 62 being IRD winding up applications. The trend continued in June 2022, with 38 total applications, including 15 company winding up applications and 23 IRD winding up applications. June 2023 saw a further rise, reaching 95 applications, consisting of 33 company winding up applications and 62 IRD winding up applications.

When considering the year-to-date figures, we observe a continuous increase in the cumulative total of winding up applications. From January to June, the numbers have consistently grown over the year apart from a slight dip in March, reflecting a persistent upward trend.

From the below graph we see that IRD’s winding up applications is almost 2x the remainder of all creditors and has continued to grow month on month since March.

Personal Insolvencies – Bankruptcy, No Asset Procedure and Debt Repayment Orders.

Personal insolvency appointments remain at the low levels seen in the last few years and are looking very similar to 2022. As a breakdown of appointment types bankruptcies remain above their long term average with both No Asset Procedures and Debt Repayment Orders below their averages.

With the increasing levels of corporate insolvencies we can expect business related bankruptcies to increase in the later half of the year. This will likely be driven by the increased cost of living struggles, personal guarantees being called up by creditors, and overdrawn current accounts being a frequent asset in a lot of liquidations.

Election Year Insolvencies

The above graph details the total corporate and personal appointments across all appointment types in this year and the last two election years.

Total insolvencies have dipped below 2020 in May 2023 Personal insolvency appointment levels continue to drag down the total as you can see in the below graph they remain below 2017 and 2020 figures. The corporate insolvency figures sit between the last 2 election year comparatives.

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Economic recap

April saw the latest inflation figures released for the year to March 2023 showing a drop from the highs seen in the last two periods. The bulk of this drop in inflation however was from international factors while domestic figures remained elevated. Because of this and a number of other reasons the Reserve Bank has continued on their track whacking on a further 50 basis point rise to the OCR. We expect to see a final 25 basis points at the next meeting.

Comparatively Australia has seen their OCR drop, it is expected we will not see this for some time in NZ. The percentage of mortgage lending that remains at fixed rates is considerably higher in NZ, Australia on the other hand has a lot of its mortgage lending at variable rates, because of this a drop or raise in the OCR has a more immediate effect on the consumers purchasing power.

Of note over the last few months, we have seen a steady uptick in coverage of insolvency appointments by various media outlets, with particular focus on tiny home builders and the construction sector. From a numbers view point the constructions sector continues to dominate the total appointments ahead of other sectors as was the case throughout 2022. Commentators have been picking up on this fact with the common narrative becoming that we see more failures in this space before any sign of a recovery begins driven by squeezed margins and falling house prices. House sales continue to be at low volumes with prices maintaining a drop on the 3 month rolling average

Company Insolvencies – Liquidations, Receiverships, and Voluntary Administrations

Company insolvency appointments figures have finally come in for March 2023 with a number being late advertised after the end of the financial year, of note we passed the 2019 highs in both March and April (once late advertisers came through) of 2023 and were easily above 2020, 2021 and 2022 levels.

We did see the expected April drop as the result of appointments rushed into the end of the financial year March figures combined with a number of public holidays in the month of April.

As at the time of writing total corporate insolvency figures for the year to date were above the last 3 years but with the slower Jan and Feb 2023 we remain behind the 2019 total levels, thought not by a wide margin.

Solvent liquidations have returned to their standard levels as seen in Jan and Feb, as mentioned last month solvent liquidations typically see a spike in March as professional advisors and shareholders push the appointments through before the end of the financial year. While other liquidation appointments remain at consistent levels, we did see a lift in Voluntary Administrations for the month and Receiverships while higher than usual did fall from the levels seen in March 2023.

Winding Up Applications

Winding Up Applications for April increased on the prior years April figures and continued the upwards trend that has occurred since January 2023. Of note is the lift in IRD applications, typically for Aprils of past years commercial applications have taken the lead, not so from the latest figures. Whether this trend will continue for the remainder of the year is still to be seen given we are in an election year. It may be the case that the IRD is pushing through their appointments in the early part of the year before taking the pressure off as the election looms or they are finally dealing with the numerous derelict debtors they have on their books. Moving forward we are expecting continued growth into the peak months of June / July.

Personal Insolvencies – Bankruptcy, No Asset Procedure and Debt Repayment Orders.

Personal insolvency appointments remain at the lowered levels seen recently. It is likely that it will take some time for the corporate lift in appointments to flow through to personal insolvencies. This lift will likely come from increased interest rates, cost of living increases and guarantees on debts from failed companies.

Election Year Insolvencies

The above graph details the total corporate and personal appointments across all appointment types in this year and the last two election years.

While the corporate appointments are at elevated levels compared to 2017 & 2020 the very low personal insolvency appointment levels for the year to date mean that the total appointments remain below both 2017 and 2020. The corporate appointments will need to remain considerably above the past two election levels to make up for the personal insolvency figures, time will tell if that eventuates.

The difference between 2023 and the last two election years is noticeable in the state of the economy from low inflation and growing economies in the past to the present high inflation and shrinking economy with a cost-of-living crisis. It is still early days for the economic crisis to be completly reflected in insolvency figures which is typically a lagging indicator of the state of the economy.

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The risk of not paying your company taxes to the Inland Revenue Department (IRD) in New Zealand can be significant and may include the following:

1. Penalties and interest: If you do not pay your taxes on time, you may be subject to penalties and interest charges. These charges can quickly add up and significantly increase the amount owed.

2. Legal action: The IRD has the power to take legal action to recover unpaid taxes. This can include issuing a statutory demand, taking court action, or placing a lien on your assets.

3. Business closure: If a business fails to pay its taxes, the IRD may take steps to wind up the business. This can result in the forced sale of assets and the closure of the business.

4. Personal liability: In some cases, company directors and officers may be held personally liable for unpaid company taxes (in particular unpaid PAYE which is Trust money). This can result in personal bankruptcy, legal action, and damage to personal credit ratings.

5. Reputational damage: Failing to pay taxes can damage a business's reputation and make it harder to secure financing, attract customers, or establish partnerships.

In short, not paying company taxes can have serious consequences for both the business and its owners. It's always advisable to ensure that taxes are paid on time and in full to avoid these risks.

If you are in arrears with company taxes to the Inland Revenue Department, there are several options available to you. These include:

1. Payment arrangement: You can negotiate a payment arrangement with the IRD to pay your tax debt over time. This can help you manage your cash flow while also meeting your tax obligations.

2. Late payment penalty remission: The IRD may consider remitting late payment penalties in certain circumstances. This may be available if you have a good compliance history and can demonstrate that the late payment was due to circumstances beyond your control.

3. Debt compromise: In some cases, you may be able to negotiate a debt compromise with the IRD. This involves settling your tax debt for less than the full amount owed. However, debt compromise is not available in all circumstances and is subject to strict criteria. 

4. Voluntary disclosure: If you have made a mistake on your tax return or have failed to disclose information to the IRD, you can make a voluntary disclosure. This involves informing the IRD of the error or omission and paying any additional tax owed. Voluntary disclosure may help reduce penalties and interest charges.

5. Insolvency procedures: If you are unable to pay your tax debt and have exhausted other options, you may need to consider insolvency procedures such as liquidation, voluntary administration, or receivership. These options involve winding up the business or placing it under the control of an external party to manage the debt.

It's important to note that the options available to you may depend on your specific circumstances and the amount of tax debt owed. It's always advisable to seek professional advice from an accountant, tax advisor, or licensed insolvency practitioner before taking any action.  Send us your enquiry from here.

Economic recap

Figures released in March saw the New Zealand economy gross domestic product (GDP) fall 0.6% in the last three months of 2022, after a 1.7% rise in the September 2022 quarter. The drop at the close of the year was larger than predicted by many of New Zealand banks and a number of economists. Annually, GDP is up 2.4% year on year, unemployment remains low, at 3.3%.

Two large banks in the United States with significant exposure to the technology sector failed, while another entered liquidation under financial distress. These banks were Silvergate Bank, Silicon Valley Bank, and Signature Bank. Outside the United States, Credit Suisse joined the above 3 banks finding themselves in difficulty, the difference here being over the last few years Credit Suisse has been in and out of the news with a number of issues and negative media attention.

From a housing perspective the downward trend continues with both monthly sales figures and year to date sale figures at their lowest in 40 years dating back to figures last seen in the 1980’s.

Company Insolvencies – Liquidations, Receiverships, and Voluntary Administrations

March’s company insolvency figures were at the time of writing slightly above those of the past three years, as we move through April final March appointments will be advertised and widen the gap over the last three years, whether March can reach the 2019 levels will show in our April Newsletter. The breakdown in the types of appointments came back in line with normal monthly figures with shareholder appointments making up 80 of the 178 appointments, there was a significant bump in receivership with 27 for the month well above the monthly average of 7, this was largely due to a group of companies (20) being placed unto receivership at one time. Court appointments also remained high but not at their February levels bringing in 45 for the month.

Historically solvent appointments have seen a jump in March at the financial year end, this level while slightly elevated in March 2023 at 23 was below the past two years where solvent appointments were in the mid to high 30’s.

It will be of interest whether the normal drop seen in April follows past years, this is normally the result of appointments pushed through to get into the end of financial year and a number of public holidays in April resulting in less working days, this negatively affects appointments for the month.

Winding Up Applications

March 2023 applications while below 2021 figures are above 2022. Once again, the corporate winding up applications portion of total applications have remained above the IRD share of the applications. As outlined last month IRD often takes a few months to hit their stride in issuing winding up applications. As seen in the below graph from May/June onwards we should see an increase in IRD application, whether this plays out in an election year is yet to be seen.

Personal Insolvencies – Bankruptcy, No Asset Procedure and Debt Repayment Orders.

Personal insolvency stats remain low, if slightly above January’s figures. Of the 106 total, 50 were from bankruptcies, 49 from No Asset Procedures and the remainder from Debt Repayment Orders. This breakdown is roughly in line with past months, Bankruptcies and No Asset Procedures remain at similar numbers with Debt Repayment Orders 10% of the total.

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Under New Zealand law, a director can be held liable for trading recklessly or insolvently if they allow the company to continue trading while it is insolvent or likely to become insolvent, and their actions cause a loss to the company's creditors.

The determinants for finding a director liable for trading recklessly or insolvently include:

1. Awareness of Insolvency: A director may be held liable if they continue to trade while the company is insolvent or if they become aware or should have been aware of the company's insolvency and failed to take appropriate action to address it.

2. Breach of Directors' Duties: Directors have a duty to act in the best interests of the company, exercise due care and diligence, and avoid reckless or imprudent decisions. If a director breaches these duties and causes losses to creditors, they may be held personally liable.

3. Cash Flow and Financial Projections: Directors have a responsibility to monitor the company's cash flow and financial projections regularly. If they ignore warnings of impending insolvency or rely on unrealistic projections, they may be held liable for reckleAss or insolvent trading.

4. Transactions at Undervalue: Directors who engage in transactions that benefit themselves or related parties at the expense of creditors may be held liable for trading recklessly or insolvently.

5. Failure to Seek Professional Advice: If a director fails to seek professional advice or act on advice received from accountants, lawyers, or other experts regarding the company's financial situation, they may be held liable for trading recklessly or insolvently

In summary, a director can be held liable for trading recklessly or insolvently if they fail to take appropriate action when the company is insolvent or likely to become insolvent, breach their duties as a director, fail to monitor the company's financial position, engage in transactions that benefit themselves or related parties at the expense of creditors, or fail to seek professional advice.

Economic recap

February saw another lift in the Official Cash Rate by 50 basis points, with a further 75 basis points expected to be added this year. The language from the reserve bank indicated that they had not seen the expected signs in inflation pull back and were continuing on their chosen path from 2022 to get inflation under control as quickly as possible.

The extreme weather events experienced in January continued into February with considerable damage to parts of the North Island. While the immediate effects have been considerable in certain areas the long term effects and costs will have wide reaching repercussions as additional spend will be necessary and likely increase demand on limited supplies and pressure on inflation figures.

Company Insolvencies – Liquidations, Receiverships, and Voluntary Administrations

February's company insolvency figures are slightly above those of the past two years. The breakdown in the types of appointment is where the real difference can be seen with court liquidation making up 47 of the 134 total appointments. This is above the 2021 and 2022 levels, more in line with 2020’s February court liquidation numbers before Covid and lockdowns became an issue.

Receiverships saw an increase with 8 for the month returning to levels not seen since 2020. What we can take from this along with the court appointments is that while there remain shareholder appointments there has been an increase in creditors (including IRD) taking action against derelict debtors either through winding up applications or secured creditors appointing receivers under their financing documents they hold against company assets.

Winding Up Applications

February has shown growth on the elevated levels displayed in January 2023. The corporate winding up applications portion of total applications have remained above the IRD share of the applications for the second consecutive month. Traditionally IRD may take a few months to warm up following the Christmas break with their winding up applications as staff return to the office. It is normally from March onwards that IRD applications track up to exceed the corporate applications. Of interest the 64 winding up applications seen in February 2023 have exceeded 2/3rds of the monthly totals in 2022 and 5/6th of the 2021 monthly applications.

Personal Insolvencies – Bankruptcy, No Asset Procedure and Debt Repayment Orders.

For another month personal insolvency stats continue their downward track to under 50 total in January 2023. While corporate insolvencies continue to move upwards this is not yet reflected in the personal insolvency stats. Over time the corporate stats increasing will likely flow through to personal insolvencies as personal guarantees get called up and collections actions continue. This has not happened yet but may increase as 2023 progresses.

If you want to have a chat about any points raised or an issue you may have you can call on 0800 30 30 34 or email This email address is being protected from spambots. You need JavaScript enabled to view it..

If you're running a struggling business, you may feel overwhelmed and unsure of what steps to take next. It's a tough situation, but it's not uncommon, and there are options available to help you get out of it.

The first step is to assess the situation and identify the root causes of your business's struggles. This may involve reviewing your financial statements, identifying your cash flow issues, and analyzing your operations to pinpoint areas of inefficiency or waste. Once you have a clear understanding of the problems, you can begin to develop a plan to address them.

One option for getting out of a struggling business is to consider restructuring. This may involve renegotiating your debts with creditors, selling assets, or downsizing your operations. A restructuring plan can help you get back on track by reducing costs and improving cash flow.

Another option is to consider a business sale. If you're unable to turn your business around on your own, selling your business to a buyer who has the resources and expertise to take it to the next level may be a good option. This can also help you avoid the stress and financial burden of continuing to operate a business that is struggling.

If restructuring or selling your business are not viable options, you may consider a formal insolvency process. This may involve liquidation or voluntary administration. A liquidation involves winding up the affairs of the business and selling its assets to pay off creditors. A voluntary administration involves appointing an administrator to manage the affairs of the business while a plan is developed to address the financial difficulties.

At McDonald Vague, we understand the challenges that come with running a struggling business. Our team of insolvency practitioners can help you navigate the process and develop a plan to get out of the situation. We can provide guidance on restructuring options, assist with the sale of your business, and provide support throughout the insolvency process.

Don't let a struggling business drag you down. Contact us today to discuss your options and find a way forward. With the right plan in place, you can get out of a struggling business and move on to better opportunities.