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The latest Insolvency Index from Experian has revealed a year-on-year fall in
business insolvencies during February.
The total number of insolvencies fell by 15.1% during February compared to the
same month last year, from 2,160 in February 2009 to 1,834 in February 2010
bringing the rate of insolvencies down from 0.11% to 0.10%.
In comparison to the insolvency rate recorded in January (0.08%), it was an
increase.
But January has in previous years been a quiet month for insolvencies and
despite the January to February increase, it still follows an overall downward
trend.
The overall financial strength score of UK businesses continued to improve, from
79.76 in February 2009 to 81.18 in February this year.
The score also saw a small month-on-month improvement from 81.16 in January.
Rolf Hickmann, Managing Director of pH, an Experian company, commented: "Small
businesses have far more flexibility than any other business type.
"It is easier for smaller businesses, with just one or two employees, to easily
make adjustments to their operations and pull in the reins when times are
difficult.
"For larger business, there is the security that comes with size and a well
established structure, so insolvency rates among these business types are also
low".
But mid sized businesses, which are seeing the highest rates of insolvencies,
are too large to be flexible and too small to rely on a strong and established
structure.
Source:
RedAlert
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