UK Businesses Distress Still Near Record Low

With the economy continuing to grow and a fairly stable outlook in Europe following another Greek bailout, it comes as no surprise that businesses in distress continue to be a rarity.

At least this is what can be concluded from the latest Business Distress Index. The index shows that only 35% of UK businesses were showing signs of distress, which although a little more than the record low seen in February is still exceptionally low by historical standards.

The UK average of businesses in distress does however mask some significant regional variations. The Midlands was the region with the lowest number of businesses reporting at least one sign of distress at 30%. Meanwhile the North showed an increase to 43%. The South, meanwhile, had 34% of business reporting distress which highlights to some extent the continuing North South divide.

With the number of businesses in distress edging up slightly overall, this could be a sign of some darker clouds on the horizon. UK exports have recently suffered their worst month in the last 5 years. Part of this is due to the strength of the pound and sluggish growth in mainland Europe.

The important thing for business owners is to prepare for any outside risks as well as those relating to more immediate cash flow issues.