The zombies are coming

BRI Business Recovery

1st April 2019

Money Matters

BRI Business Recovery

By Peter Windatt

BRI Business Recovery

HOW do you write an article of interest to business readers when the date for submission is before the current date planned for Brexit and publication is thereafter? Those few days could make all the difference. If you want to make God laugh, tell him your plans.

Did someone say zombies? Walking among us? Fear not, the zombies in question are the one in 10 companies that are believed to only be able to pay interest on their debt and not make any contribution to repay the debt itself. Their numbers had been falling but, since the Brexit vote, tougher trading conditions and uncertainty have caused many businesses to be doing no better than tread water. In fact the failure rate of companies has seen a slight increase.

Whether there is going to be a rush of orders change hands after the post-Brexit dust has settled (whenever that might be) remains to be seen. The insolvency profession would normally expect to get busier when the economy finally stops bumping along the bottom and we, hopefully, see an increase in consumer and business demand. This may, at first sight, appear counter-intuitive. However, when business is being asked to pay their employees, sub-contractors and materials in order to fulfil pent-up orders they might find themselves over-trading. The bills they have coming in may be due for payment long before their customers have paid up. From cracking open the champagne in celebration of that great new order to having to call upon our insolvency services can be a short step if cash-flows and loan facilities are not in place when needed.

If you or a client/contact/friend has a worry along these lines, contact any one of the BRI management team to talk through those concerns and, hopefully, help lay them to rest.

BRI's head office is in St. James, Northampton - call 01604 754352 to arrange a free, confidential chat with no obligation.

BRI Business Recovery