North West sees 32% rise in firms in ‘significant financial distress’

The number of firms in the NorthWest operating under “significant financial distress” has risen by almost a third on last year – with analysts from Begbies Traynor saying there is increasing pressure on the retail and hospitality sectors.

The study from Begbies Traynor’s Red Flag Alert showed 65,777 firms in the region were operating under significant distress in the third quarter of the year. The index measures “sustained or marked deterioration in key financial ratios and indicators including those measuring working capital, contingent liabilities, retained profits and net worth”.

Distress levels rose in 20 of the 22 sectors studied in the North West over the last quarter with the biggest leaps in food & drug retail (14%), bars and restaurants (11%) and hotels & accommodation (11%).

Four sectors make up almost half (48%) of all firms in significant distress – construction (9,338 firms), real estate and property (6,722), support services (10,063) and professional se