New data released today by Creditsafe, examining the rate of company failures across 12* UK business sectors, reveals 0.33% of companies in the Hospitality sector failed in Q3 2018. Across the Hospitality industry – inclusive of hotels, restaurants and bars – there were 591 company failures, compared to 330 in the same time period in 2017. The top three company failures by size were Gioma UK, Cau Restaurants LTD, and Villandry Foodstore Restaurant LTD.
The Creditsafe Insolvency Index ranks sectors according to the percentage of insolvencies each has suffered compared to the number of active companies during the third quarter of 2018.
The Construction sector came in second place on the Index with an insolvency ranking of 0.22%, which reflected 943 company failures for the sector, while Manufacturing was in third with 430 failures (0.22%). The lowest rate of failure went to the Farming and Agriculture sector, which only had 0.05%, equal to only 17 company failures.
The data showed that two thirds of the sectors analysed had over 0.1% of their active companies fail. In addition, three quarters of the sectors experienced a higher rate of failure in the third quarter of 2018, compared to 2017. The sectors with the highest jump compared to last year reflected the sectors that had the highest rate of failure overall – Hospitality, Construction and Manufacturing.
Chris Robertson, UK Managing Director of Creditsafe, said: “Our insolvency index has produced interesting results that show the pressure that all sectors across the UK economy are under. Clearly, company failures in some sectors hit the headlines more than others, but this data shows that the rate of failure in the hospitality, construction and manufacturing industries in particular is cause for concern. This is a reminder for companies to stay on top of their own finances and heed any warning signs, while also staying vigilant across the supply chain by carrying out company credit and health checks.”
Turning to other industries, despite the Transport and Logistics sector showing a failure rate of 0.12% in Q3 2018, this was one of the best performing sectors compared to last year. In addition, Professional Services had the largest number of active companies at 1.4m, and the highest total number of failures at 1,294. However, this equates to a failure rate of 0.09%, which positions the Professional Services sector as one of the better performers.
* Farming and Agriculture, Construction, Banking and Financial, Hospitality, IT, Manufacturing, Professional Services, Retail, Sports & Entertainment, Utilities, Transport and Wholesale.