The number of corporate insolvencies in the South West fell by 11 per cent in June compared to a year ago, according to research by the Bristol office of Evelyn Partners, the leading integrated wealth management and professional services group created from the merger of Tilney and Smith & Williamson.

Figures compiled by the firm using official data* show there were a total of 57 insolvencies recorded in the region last month. The majority of these - 53 in total - were creditors’ voluntary liquidations which resulted in the complete closure of the business.

There were only three company administrations and one company voluntary arrangement recorded in June, where there may be a prospect that the company, or part of it, can be rescued.

The latest figures represent a fall when compared with June 2021 when the number of corporate insolvencies in the South West totalled 64. The sectors most affected by insolvencies last month were construction, retail and service, with numbers also rising in the manufacturing and real estate sectors.

Despite the fall in the total number of insolvencies, the retail and service sectors saw an increase in insolvencies – and to a level greater than currently being experienced in the rest of the UK.

Mandy Pope, who is a senior manager in Evelyn Partners’ restructuring and recovery services team in Bristol, said:

“The effect of rising inflation and the ever-increasing cost of living is understandably resulting in less money being spent on the high street.

“If it continues, this may in turn start to have an impact on the housing market when combined with any further interest rate increases which may be implemented by the Bank of England in an effort to stem rising inflation.

“The region has a wealth of hospitality and holiday businesses and with the summer well underway there may be a tendency for businesses already struggling to expect and rely on an upturn over the coming months based on previous years. Those businesses may already be struggling to pass on the increased costs of utilities and also with supply chain issues.”

She added:

“We would always urge companies currently encountering difficulties to seek insolvency advice at the earliest opportunity, rather than assume the summer will bring an upturn, in order to maximise options available.

“If advice is sought as soon as difficulties arise it may be possible to consider a turnaround or restructuring option in order to save the business, or failing that, to enter a formal insolvency process whereby all or part of the business can continue. This should ensure the best possible result for employees and creditors.”

*The regional insolvency figures are based on data from The Gazette, the UK’s official public record. They include businesses registered in the South West and those with directors based in the region.