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For instance, it’s common sense for builders, scaffolders and cement pourers to be classed together under construction but what about a travel agent and a security guard?

Or a car leasing company and a landscape gardener? Or an employment agency and a bouncy castle hire business?

They all come under the seemingly disparate title of administrative and support businesses which is a broad umbrella title that covers amongst others: 

So now we know which sort of businesses we’re talking about - how did they collectively manage during the year of lockdowns and afterwards?

Less is more

The initial figures show that in the year leading up to the first lockdown being implemented - Mar 2019 to Feb 2020 - there were 1,798 insolvencies involving businesses in the administrative and support sector. 

The immediate 12 months afterwards - Mar 2020 to Feb 2021 - saw 1,421 administrative companies close. 

Although this is 377 less, it’s still larger than might have been expected considering the temporary halt on creditor actions like winding up petitions and the range of additional support made available to businesses over the past 18 months.  

1,421 is a larger number than the losses reported by the hospitality and retail sectors, which were most popularly believed to be the worst affected in the pandemic with 1,378 hospitality companies and 1,355 businesses in the retail sector becoming insolvent. 

According to official statistics supplied by the Insolvency Service, there have been an additional 358 insolvencies in the administrative sector since March this year which takes the total number since lockdown to 1,779 - which is 118 a month or 29 a week shutting their doors. 

Did bounce back loans soften the blow?

The coronavirus jobs retention scheme or furlough, did help a lot of administrative businesses keep staff rather than forcing them to be made redundant. 

As the travel industry ground to a halt and nightclubs and other sectors that would usually require security staff didn’t need them, administrative businesses with no income needed support and quickly. 

The bounce back loan scheme and CBILS was rolled out for just such a purpose and these companies made use of it. 

The number of loans taken out by administrative services was 102,946 - more than the collective borrowing of the manufacturing, real estate and transportation business sectors. 

The total amount borrowed was £3 billion, which is an average borrowing amount of £29,141 per company.  

Under the most conservative official estimates, it’s expected that 15% of the total lent to the industry would remain uncollected would be £450 million but if the default rate rose to even 40% then this figure would also grow to £1.2 billion. 

You can still close your company even if you have bounce back loan arrears - find out how

Since pandemic restrictions began to be lifted, administrative businesses can begin trading again and supplying their valuable services to customers but there are storm clouds gathering on the horizon

The furlough scheme is finally being wound up at the end of September which means businesses either have to bring their furloughed workers back on full pay or implement redundancies. 

Any bounce back loan or CBILS arrears will continue to grow if they’re not being paid and any outstanding VAT arrears from their suspension in 2020 are now due too. 

Creditors will also be able to begin to take action to reclaim unpaid debts from September 30th too, allowing them to seek statutory demands and winding up petitions if not paid within 21 days of receipt. 

Chris Horner, Insolvency Director with said: “Administrative businesses have had one of the worst hands dealt to them during the pandemic and lockdown. 

“A lot of them didn’t qualify for any support other than bounce back loans and repaying these could become one of the biggest challenges businesses face this and next year if they aren’t able to trade like they did before. 

“The travel industry is still in flux to put it mildly, hospitality and nightclubs are just reopening but will need to comply with new rules and regulations shortly with little guidance being given to their security on how they will be implemented. 

“The shakeup in the commercial property sector will have big knock on effects for cleaning and landscaping businesses that service them so will make their financial forecasting nearly impossible to predict too.

“One thing administrative and service businesses can do is adapt and adapt quickly so they can use their talent and experience to take advantage of the little time left before September 30th and get some professional advice on how they can help themselves before so many rules change.

“A recovery strategy can work but only if it’s created and implemented now. This can include managing any unsustainable debt including bounce back loan arrears, VAT arrears or CBILS.”

A lot of people thought that by the end of September 2021, if not business as usual, we’d be at a stage of business getting back to usual. 

But for many companies and sectors - especially administrative and support businesses - it really isn’t. 

Debts have increased, more are appearing and the last protections from creditors are days away from being removed. 

There could still be a practical way forward for a business in this position but only if they take the first step and get in touch to arrange some practical, professional advice

We offer directors and business owners a free, initial consultation to set out their position and once we get a full understanding of the issues we face, we can work with them to create a strategy to meet and defeat these challenges. 

But get in touch today because after September 30th, the choices might be harder still. 


The Coronavirus Job Retention Scheme, more commonly known as furlough, was launched in March 2020 to support businesses and employees through the unprecedented disruption caused by the coronavirus and subsequent lockdowns. 

In our Year of Lockdowns report we found that one in three UK workers were in receipt of a furlough scheme payment at some point in 2020. 

The popularity of the scheme peaked in April 2020 when just under nine million workers were furloughed although this total has reduced to just over 1.9 million by the end of June 2021. 

According to the latest official figures, 11.9 million jobs had been placed on furlough by over 1.3 million employers at some stage during the previous 18 months at a total cost of £65.9 billion. 

This might seem expensive but it would be argued by supporters that it fulfilled one of its primary objectives by holding the unemployment rate at 5.1% at the end of 2020 which saw an additional 1.7 million people looking for work but without furlough. 

This figure has since reduced to 4.8% at the end of June 2021 and is currently only 0.9% higher than at the beginning of the pandemic. 

Why you should pay to liquidate your company

Since May 2021, the central contribution to employees wages from the government has reduced from a figure of 80% of the total wage up to a maximum of £2,500 down to 60% of the total to a maximum of £1,875. 

The employer continues to pay national insurance contributions (NICs) and pension contributions for staff as well as a 20% contribution to wages for hours not worked up to a maximum of £625.

Along with many other notable changes occurring at the end of the month, the one which is expected to have the most immediate effect is the final closure of the CJRS.

Chris Horner, insolvency director with, thinks attention should be paid to the discrepancies between various sectors and mismatches between vacancies and employees when analysing the impact. 

One example is in the hospitality sector including both accommodation and food services.

The Office for National Statistics vacancy survey showed that 117,000 jobs were available between May and June but at the same time 337,800 staff remained on furlough during this period. 

Even if furloughed staff successfully reapplied for all those positions, there would still be over 220,000 workers left without positions. 

He said: “When you have a mismatch between the sectors that people are on furlough from and the sectors that are actively recruiting then there will naturally be an imbalance that has to be carefully managed - both in terms of the personnel and the support given to businesses in those areas. 

“Some skills will be transferable but not every position is. 

“Sales assistants and hospitality staff might not want to take pay cuts to move into the care industry or spend time retraining as a delivery driver or production operative for instance.

“This could clearly have implications for businesses and unemployment in the short term at least.

“For small business owners and directors, who are already juggling with bounce back loan repayments, VAT arrears, the return of creditor actions including winding up petitions and business rates, a staffing crisis will be the last thing they need.”

Bounce back loan arrears affect sole traders and partnerships too

If you think the school holidays and summer went quickly, you won’t believe how soon the end of September will arrive. 

There is still just enough time to get in touch with us and arrange a free initial consultation with one of our expert advisors.

If you’re worried or already having problems repaying debts like bounce back loans or VAT arrears then we can help advise you on what your options are. 

The sooner you take action, the more time and leeway you’ll have to use - because sadly, time and choices will eventually run out.  


Stress might be one of the most misapplied words in common usage. 

Any good construction professional will be able to explain that stress is a temporary force acting on structure while strain is a permanent change - either in shape or size - directly resulting from the pressure of that stress. 

A little stress can be a good thing as it can prove that a design or structure is working as it’s meant to. It’s when it becomes a strain that more serious issues can occur. 

So has the previous 18 months caused the construction industry severe stress or has it turned into a permanent strain on the sector?

Year of Lockdowns

No UK industry was more badly affected by the pandemic than the construction industry. 

From March 2020 when the first lockdowns were instituted to the end of March 2021 more than 1,600 building firms closed down permanently. 

This is higher than both the hospitality and retail - two sectors previously thought to have fared the worst since the pandemic began. 

1,634 firms in construction went under during this period compared to 1,378 in hospitality and 1,355 in retail. 

In our Year of Lockdowns report, we broke down how the pandemic had affected every aspect of life across the country for businesses, their owners and staff. 

We found that the halting of various large and small scale building projects had badly damaged all elements of the construction industry. 

According to official Insolvency Service statistics, there have been an additional 596 construction insolvencies since March taking the total number since lockdown to 2,230 or 34 a week.

In this month alone, Darlington based Cleveland Bridge and All Foundations, one of the country’s top piling contractors, entered administration while Mansfield based Minister and AM Griffiths from Wolverhampton ceased trading altogether and went into liquidation. 

Sadly, they will be joined by other notable names this year.

Loans granted but will construction bounce back?

The various government support schemes greatly benefited construction during the past 18 months. 

The coronavirus jobs retention scheme, better known as furlough, allowed them to retain some of their most valuable staff while sites and projects shut down and borrowing such as CBILS and bounce back loans allowed them to quickly access funds to support themselves. 

Especially bounce back loans. 

The construction industry collectively accessed the most bounce back loans of any sector with nearly a quarter of a million bounce back loans granted - 238,825.

The total amount borrowed was £7 billion, second only to the retail industry, which is an average borrowing total of £29,310 per company.  

Under the most conservative official estimates, it’s expected that 15% of the total lent to the industry would remain uncollected which is a not inconsiderable £1.05 billion. 

This doesn’t just affect large contractors and builders but many sole traders and partnerships too, which make up a large proportion of the industry.

You can still close your company even if you have bounce back loan arrears - find out how

Next month sees a further bottleneck of trouble brewing for already struggling builders. 

The coronavirus job retention scheme better known as furlough is finally wound up meaning businesses will either have to decide to welcome workers back on full wages with no government support or consider redundancies. 

Bounce back loan and CBILS payment arrears will continue to be demanded along with any unpaid VAT arrears from 2020.  

Also certain creditors actions are set to resume on September 30th allowing creditors to seek statutory demands and winding up petitions for unpaid debts and a further small but critically important protection for constructors is also being removed. 

Termination clauses were suspended which stopped suppliers from ceasing their supply or asking for any additional payments or security from businesses that are undergoing a restructuring or administration process. 

From the end of next month they will be able to once again, which will place further strain on otherwise viable but struggling companies and potentially lead to more disorganised and chaotic collapses rather than professionally managed recovery strategies and business rescue plans. 

Chris Horner, Insolvency Director with spotted this specific danger last month when he said: “Construction companies that rely on the guaranteed availability of materials could quickly find themselves in difficulty if suppliers start to use these newly restored rights, right away.

“Due to the actions of a supplier, otherwise profitable businesses could find themselves trading while insolvent through no fault of their own. 

“If a builder, civil engineering practice or other vital part of the construction industry that underpins so much of the country’s infrastructure is now worried about what these changes will mean, we can help reassure them.

“There is a small window of opportunity for them to act - right now - before September 30th.

“We can help them formulate a recovery strategy for their business that will protect them into the Autumn months and beyond. 

“This includes if they have bounce back loan arrears, CBILS debt, VAT arrears or other unsustainable debts that have built up over the previous 18 months.” 

Construction businesses naturally have a genius for delegation. 

Not just using the right tool for the job but the right subcontractors, the right workers and the right people in the right places at the right time. 

We employ the same principle for businesses facing financial difficulties. 

Speak to an expert who can give you a quote and let you know exactly what they would do, when, how, why and then deliver on their promises.

The sooner a business owner or director gets in touch to arrange a free initial consultation, the earlier we can let them know what options they have and the quicker they can be implemented. 

Rules, regulations and trading conditions will change next month along with the seasons so act today so you won’t be caught out tomorrow. 

But in many ways, despite lockdowns being lifted and restrictions easing across England, Scotland, Northern Ireland and Wales, this is exactly what’s happened. 

Since the Covid-19 lockdowns began the Insolvency Service has been providing monthly figures on the number of businesses that have undergone an insolvency procedure such as administration, company voluntary arrangements (CVAs) or liquidations

For retailers the figures are sobering. 

Since May 2019, 1,316 retailers have entered insolvency. This is a rate of 110 a month or more than four a week. 

This is with the restrictions on creditors’ recovery actions such as statutory demands and winding up petitions that are due to be lifted at the end of September at the same time that all other Covid-19 support ends including the furlough scheme

Why a CVA could be retails best defence against the multiple threats it faces

Earlier this year we investigated how much bounce back loan borrowing had been done by businesses in each industrial sector and found that retail businesses had collectively borrowed the most. 

216,718 loans were granted to retailers while the scheme was still running for a combined total of £7.7 billion which is an average of £35,530 per retail borrower. 

This is the equivalent of building a new Wembley Stadium and still having £1.6 billion in change left over. 

We also looked at the estimated rate of defaults and even under the best case scenarios we modeled - 15% of loans remaining unpaid - this would still be £1.16 billion missing from the public purse. 

Against this backdrop, sales are beginning to rise with annual sales growth for July for the sector standing at 6.4% although this is steady rather than spectacular as the three-month average was 14.7%.

Any positive news in the sector should be cheered at the moment as it finds itself fighting to reestablish itself on many different fronts. 

Another worrying statistic to illustrate this came this week with new research published by the British Retail Consortium and the Local Data Company (LDC). 

It shows that more than one in seven shops are now vacant across the country - including high streets, retail parks and in shopping centres - the highest levels since 2015 and the highest ever recorded by the LDC. 

Indoor shopping malls now have a vacancy rate of 20% too, underlining how the enforced change in shopping habits over the past 18 months along with high profile brands such as Debenhams and the Arcadia Group which owned Topshop, Miss Selfridge and Dorothy Perkins, went into insolvency and liquidation after selling these brands to new operators where they became online-only. 

Regionally, the North East of England had the highest overall proportion of empty shops at just over a fifth and saw the biggest increase in vacancies during the last 12 months. 

Greater London proved the most resilient with a rate of 10%.

Helen Dickinson OBE, Chief Executive of the British Retail Consortium said: “The retail vacancy rate is continuing to rise. 

“Many shops and local communities have been battered by the pandemic, with many high streets in need of further investment. Unfortunately, the current broken business rates system continues to hold back retailers, hindering vital investment into retail innovation and the blended physical-digital offering. 

“The Government must ensure the upcoming business rates review permanently reduces the cost burden to sustainable levels. Retailers want to play their part in building back a better future for local communities, and the government must give them tools to do so.

“The vacancy rate could rise further now the Covid-19 business rates holiday has come to an end. The longer the current system persists, the more job losses and vacant shops we will see. 

“July continued to see strong sales, although growth has started to slow. 

“The lifting of restrictions did not bring the anticipated in-store boost, with the wet weather leaving consumers reluctant to visit shopping destinations. Online sales remained strong, and with weddings and other social events back on for the summer calendar, formalwear and beauty all began to see notable improvement, so fashion outlets in particular saw a bounce back to pre-pandemic levels. 

“As many people prepare to return to the workplace, purchase of home office equipment began to fall after months of high sales, meanwhile other homeware, such as furniture and household appliances continued to do well.”

The government is planning to publish a review of business rates in the Autumn after retailers were given a holiday from the tax throughout the pandemic. This tax break began to unwind last month and will end for all businesses in March 2022. 

Lucy Stainton, Commercial Director for the Local Data Company added: “After an initial flurry of CVAs and closures due to consumer behaviour shifts and cost-cutting exercises, retailers are now starting to dust themselves off with cautious optimism, keeping an eye on the rapidly changing infection rate and the pace at which vaccinations are taking place; two measures that could seriously derail the recovery efforts should they not go in the right direction.”

Retailers expecting a fantastic sales surge will have been disappointed this summer season.  

Several will have invested a lot into their businesses ahead of an expected grand reopening and if they metaphorically put their foot on the gas - they’ve got a whimper instead of a roar.

Sadly for them and every other firm struggling with their bottom lines right now - bills and debts continue to arrive even if the expected sales haven’t. 

With the last of the Covid-19 support measures being withdrawn in the next few weeks and creditor actions being reinstated at the same time, it could be a sharp and uncomfortable Autumn for a lot of otherwise profitable businesses. 

Because time is running out, we’ll get straight to the point - get in touch with us today.

We won’t waste your time with fancy theories or upselling you services you don’t need. We’ll use your free initial consultation to find out precisely what you’re up against, then come up with some timely and effective solutions you can start to put into practice straight away. 

Things are going to get more uncomfortable for a lot of retailers before the year is out so by using the time you have now to arrange a restructuring and rescue strategy or other methods depending on your goals, you can spend it doing more important things - making more money.   

Of course they operate in their own sector but they have to pay bills, employ staff and provide a valuable service and make a profit to reinvest in growth and development - just like any other company. 

But they face a range of unique challenges and constraints too. 

Their safeguarding measures will be more stringent than most companies and they will be under closer scrutiny too due to the nature of their existence - keeping children safe, educated and happy. 

Not that the challenges of the last 18 month have been anything but normal for institutions, students and staff alike.

Classroom bubbles, home or halls of residence quarantines and entire terms spent moving in-class learning to online platforms for remote learning.

Taking remote learning as an example - schools and colleges have had to make sure that enough students (and staff) have the actual technology to be able to deliver and receive tuition. 

This can mean purchasing laptops and tablets, along with necessary software licenses if applicable.

Any establishment that offers accommodation will have seen this income stream vanish along with those that hire their facilities out to other businesses and local communities for sport, productions and corporate events. 

With the ongoing disruption to international travel and Brexit restrictions means any business relying on foreign students would have seen severe disruption to this model - as does the idea of remote learning for establishments whose whole business model is based on in-person tuition or residence. 

In 2019, Hadlow College and West Kent and Ashford College became the first in the UK to go into educational administration costing the Department of Education some £26.6 million to keep them operating while a permanent solution to their educational provision was found. 

When the total support for all colleges in England receiving financial aid was factored in then the total rose to over £40 million. 

This includes the provision of £14.4 million in emergency funding to five unnamed colleges in “serious financial difficulty” that received payments in order to prevent them from also entering educational administration. 

Significantly the Education and Skills Funding Agency (ESFA) which provided the payment, recognised that the cost and effort of handling colleges in education administration means “it may need to limit the number of colleges in the insolvency regime at any one time,” depending on each case. 

The Department for Education said protecting students is “the overriding priority for colleges that have entered education administration” and the most significant costs from the two insolvency cases were related to “supporting the operation of the colleges while they were in administration and in facilitating a long-term solution by enabling the transfer of the provision to other local providers.”

Some money will be recouped from the sale of campus assets which are no longer required for educational provision such as buildings and land but not every college has assets that can be sold to support them. 

The National Audit Office also revealed that the government was intervening in nearly half of all open colleges and had spent over £700 million on bailing out and restructuring colleges in the previous 12 months up to September 2020. 

The figures for the following year might end up being even worse.

Can I still be chased for bounce back loan repayment if I close down my business?

When it comes to borrowing under the bounce back loan scheme, our own investigations have revealed that businesses operating in the education sector obtained over 31,000 loans totalling some £726 million overall - an average total of £23,238 per loan made.

We also calculated that according to official estimates between £109m to £436m could be expected to be written off from repayment. 

In an effort to keep the number of education administrations from rising, the government has proposed giving the Education Secretary the ability to force college mergers instead. 

The Skill and Post-16 Education Bill currently before the House of Lords, proposes to “extend the existing intervention powers, enabling the Secretary of State to: exercise their statutory intervention powers in circumstances where there has been a failure by a college to adequately meet local needs and direct structural changes (such as mergers) where use of the powers has been triggered under any of the thresholds in the legislation.”

The Bill says it will give “power for the Secretary of State to amend legislation to expressly provide for Company Voluntary Arrangements to be available in education administration”. 

With the numbers of colleges and schools in financial difficulty rising throughout the country, new powers can help administrators rescue educational establishments should only be welcomed. 

Under the current rules, An educational administrator can be appointed by the Secretary of State to take over an insolvent college.  

They will have a wider remit than in a standard administration as their job will be to protect courses for learners alongside their statutory duty to secure the best outcome for creditors.  

Other industries such as energy, railways and housing associations also have special administration regimes in place to protect vital public services if the provider supplying them runs out of money.  

If students have already begun their courses when a college goes into administration or other insolvency proceedings then they will look for another institution to take over the course provision alongside their insolvency duties. 

Administration might be the best solution for an indebted education business if new buyers are happy to take on the existing debt and provide new investment, energy and ideas into the institution.  

They will have their own plan on how to return to profitability and will be encouraged to do so if at all viable. 

Similarly, if the business can otherwise make a profit but is burdened with seemingly insurmountable debt or has been temporarily affected by Covid-19 but is otherwise fundamentally sound, then a company voluntary arrangement or CVA might be suitable. 

In return for a proportion of the debt being written off, they will repay the remainder in regular monthly instalments, usually for five years, until it’s cleared. All the while continuing to trade, provide a service and gain customers.  

Even though the Department of Education would prefer private schools and universities to be saved in one form or another, sometimes the financial reality means that closing down the business and liquidating the company is really the only option on the table. 

This will allow the institution to be closed in an orderly and efficient way with all assets being sold to benefit creditors.

Another advantage for an education based business to consider liquidation is that it will be conducted and managed by a licensed insolvency practitioner. 

In a creditors voluntary liquidation (CVL), their role is to oversee the valuation and sale of assets at a fair price to repay creditors as far as possible. Crucially, they will also handle all creditors claims which could be useful if they include staff, students or parents. 

Any liquidation process needs to be handled carefully as the business has to cease trading immediately and close in an orderly fashion but one involving children or older students worried about their future paths needs special care and attention given to both the procedure and the ongoing communication with creditors. 

Liquidations can also include bounce back loan debt or CBILS lending too but an insolvency professional will be able to advise more specifically. 

Every industry has had challenges to overcome during the year of lockdowns

Some have been common to every business, some have been unique to the industry in question and education is no exception. 

The experience of being a student has changed, possibly irrevocably, and this will have short and long term consequences - some temporary, some permanent and others that can’t be predicted yet. 

The landscape has changed - probably for good and it provides every business in the education sector with new problems - but also solutions too.

No matter what your situation - one of the best moves you could make right now is to get in touch with us.

We offer governors, directors and business owners a free initial consultation where we can discuss your business in detail and help you plan your next steps - efficiently and effectively. 

Now colleges and schools are being treated like any other business when it comes to insolvency, they can also use the advantages of the protections that some insolvency processes bring too - but only if they act while they have the time to do so.

Being taught a lesson is one thing, learning from one is always better. 

We’ve previously written that the government was bringing in new changes to the law surrounding pre-pack administration earlier this month. 
After debate in the House of Commons and the House of Lords this week, the changes to the legislation were duly passed by parliament and will formally come into force on April 30th 2021. 

What is Pre-Pack administration?

While we always approve of any efforts to improve and strengthen the insolvency and restructuring process, it will be interesting to see how the role of the evaluator in the pre-pack process will play out in actual cases. 
Some pre-pack administrations involve the sales of a distressed business to “connected parties”. These are individuals with some previous connection to the business - and can include previous directors or management who want to buy the company and run it themselves. 
In an effort to improve stakeholders' confidence in this process, one of the legal changes was to have every sale involving a connected party overseen by an independent evaluator.
But there’s some concern within our industry about the status and qualifications of the evaluators. 
Colin Haig, President of R3, the insolvency and restructuring trade group said: “We welcome efforts to improve stakeholder confidence in pre-packs, but it may be proved that this legislation has missed the mark. 
“Sales to connected parties in pre-pack administrations will now be subject to creditor approval, or review by the new independent Evaluator position. 
“The rationale for this is clear but the practicalities around ensuring that an Evaluator is a fit and proper person is where the regulations could fall down. 
“These regulations effectively leave it to the market to regulate the Evaluator position. A far better alternative would have been for the Government to agree to maintain a list of approved Evaluators. 
“This might have meant an additional administrative burden for them, but it would have given stakeholders greater confidence that these reforms were robust rather than just the easiest option for the Government.”
Some of the speakers in the parliamentary debate raised concerns about the prospect of “opinion-shopping” when it comes to evaluators - only appointing one that happens to agree with your valuation or choice of buyer. 
One of the speakers in the debate, Lord Foulkes of Cumnock, said: “As others have done, I also want to ask about the Evaluators, who will be given significant responsibilities. 
“It would be helpful to know what qualifications will be required to act as an Evaluator and will the Government consider a register of approved Evaluators maintained by the Insolvency Service?”
The Insolvency Minister Lord Callanan didn’t agree to any changes in the legislation but said that the Government may revisit banning connected party pre-pack sales or further reforms if the regulations prove not to be working as intended. 

We answer directors questions on pre-pack administration

Chris Horner, Insolvency Director with Business Rescue Expert, reiterates our position. 
He said: “Getting an Evaluator, who will act as a qualified valuer, to report on any sale and putting their professional opinion, with any supporting evidence, in writing provides transparency and clarity to any administration sale.
“We have always used professional third parties to provide their opinion on transactions we have initiated or overseen so it’s encouraging that our approach has been codified into law as legal best practice.
“Further cementing trust in our industry and our procedures will be paramount in future as government financial support for businesses is withdrawn and more will be seeking professional insolvency advice and help as they decide what direction they can take their business as a result.” 

If 2020 was a Year of Lockdowns then 2021 could well be a year of challenge and change. 
As more businesses begin to reopen, free from previous restrictions, they might re-emerge into a new, unfamiliar world.  
We don’t know how customers will react without restrictions and how many behaviours adopted in lockdown such as online shopping, dining in and expanded home deliveries will become permanent and replace old patterns that these companies relied upon. 
What we do know is that we will be there to offer our comprehensive professional advice and support to any business owner or director who needs it. 
A free initial consultation with one of our expert advisors will be the first step in a comprehensive recovery plan or pivot to give a company every chance of trading successfully in our new environment. 
Get in touch today so you can start making the decisions and changes you need to before it becomes too far down the line to change the destination. 

guildford high street

The Local Data Company (LDC) have published their eagerly awaited retail and leisure market trends report for 2020
The report pulls together the total number of stores opening and closing with lots of other data sources, giving a comprehensive account of the performance of physical retail properties in the UK. 
The hot take is that it’s bad but it could be worse. 
Underlining the findings in our own year of lockdowns report the research showed that over 11,000 locations closed their doors for the final time in 2020, making it one of the most difficult trading years for physical retailers. 
This figure includes 9,877 branches of various chain brands and 1,442 independent retailers. 
The news could have been even more negative with trends pointing to nearly 15,000 outlets being vacated but the various government support measures and limits on creditors’ actions including the suspension of winding up petitions and a moratorium on company evictions helped depress the figures at time of publication. 
The true impact may not yet be totally apparent as many outlets surveyed had temporarily closed due to lockdown and were not officially classified as being closed although in all likelihood they may never return when restrictions are gradually lifted, such as the eight locations John Lewis recently announced would not be reopening.
Outlets that had the steepest declines in their numbers were primarily fashion and clothing stores including Debenhams and members of the Arcadia group such as Topshop and Miss Selfridge along with bookmakers, estate agents and mobile phone shops. 


2020 is the worst year for retail closures - ever

Other notable findings included:

Finally, they also highlighted the unique challenges facing landlords of larger department stores. 

The devil’s in the detail for retail landlords

Citing their previous work, they found that between January 2017 and December 2019, only 24% of landlords had found new occupiers for large stores with no capital investment required. 
Another 30% of former department stores saw some structural changes either being split into smaller units or being demolished, new, smaller property built in its place. 
Lucy Stainton, Head of Retail at LDC said: “The report shows a marked increase in the structural decline across the physical retail and leisure markets but we would also argue that we aren’t yet close to seeing the full impact of the Covid-19 pandemic. 
“What remains to be seen are the consequences of government support ending, effectively ‘defrosting’ a significant portion of the market which has been frozen in time since the onset of the pandemic. 
“With this in mind, we would expect to see the state of play in terms of vacancy rates and net change worsening over the course of 2021 and 2022 before levelling out.

“Hope is not a strategy” - James Cameron

While it’s certainly been a rocky 12 months for retail and leisure businesses, you could forgive them for being excited with the end of lockdown on the horizon and the idea that they could be welcoming people back through their doors once more. 
But the lesson of 2020 is that things rarely work out exactly as predicted and the underlying message of both our and LDC’s research is that things are likely to get worse for retail businesses before they start to get better.
We would love for economic activity to begin to return to normal from April and for businesses to be flying by the start of Summer but there are no guarantees. 
In fact, if there’s a delay to the vaccination program, further outbreaks or mutations of Covid-19 or other negative events then this will have a negative impact on the ability of companies to reopen and recover. 
This is all before factoring in the effects of the end of the various government economic support schemes and the reimposition of creditor recovery tools and other items such as the return of wrongful trading responsibility and company evictions which will happen at the end of June. 
All in all, this makes today the perfect time to take a quick breath and really understand where your business stands and how it could cope if trading conditions don’t improve in the immediate or short term. 
You can get in touch with us anytime you like to arrange a free initial consultation with a member of our professional, experienced team.
We’ll discuss where your business is at financially, what issues and difficulties you’re facing and what you can do - right now - to begin to tackle these. 
So even if things don’t start with a bang, you’ll be strong enough to take advantage when they do.

2020 Year of Lockdowns

It’s nearly been 365 days since the UK went into its first national lockdown as it faced its first major public pandemic in over 100 years.

From March 23rd 2020, companies in every sector closed by order and we all had to work, educate and shop from home to contain the spread of Covid-19.

Nothing has really been the same since - especially for businesses.   

We’ve spent the past 12 months helping firms that have fallen into financial difficulties to restructure and pay off their debts under new arrangements or allow them to efficiently close so their owners can move onto new challenges when the lockdown is gradually lifted completely. 

Alongside our business rescue and recovery work, we’ve also spent a year observing, collating and analysing data from various sources to compile a comprehensive and wide-ranging report of what happened to our country and its companies.

The “Year of Lockdowns” story shows what effect restrictions have had on the various industrial sectors, geographic regions and on the individual businesses and employees that make them up.  

This is the story of 2020 - a "Year of Lockdowns”. 

COVID-19 caused more economic damage to the UK than Napoleon, Hitler and The Kaiser 

In an already historic year, we should start with the news about history being made.  

The Office of National Statistics reported that 2020 saw UK official GDP shrink by 9.9% in the previous 12 months - the largest annual fall in over 300 years since the Great Frost of 1709. 

The collapse is even greater than any previously recorded including during the Napoleonic wars; World Wars One and Two; the great depression of the 1920s and the great recession of the late 2000s.  

The economy regained some ground in the second half of the year as some lockdowns were eased and the “Eat Out to Help Out” scheme attracted more people to support their local pubs and restaurants.

Despite these positive factors, the economy was still 6.3% smaller than it was in February, the last full trading month before the first lockdown was implemented. 

This was the biggest fall among all the G7 nations with USA GDP down 3.5%; Germany down 5% and Japan down 5.6% by comparison.

One in three UK workers were furloughed as unemployment rose to a six year high


Since the beginning of the lockdown and the Coronavirus Job Retention Scheme (CJRS) being rolled out, 11.2 million workers have been furloughed in the previous 12 months. 

With 32.6 million people employed in the UK, this means that one in three workers was in receipt of furlough pay at some point in 2020. 

The UK unemployment rate also rose by 1.1% to 5.1% by the end of 2020 with 1,744,000 additional people looking for work. This is the highest recorded level since 2015. 

Chancellor Rishi Sunak extended the furlough scheme until the end of September 2021 in the recent budget with employers expected to contribute 10% of furloughed employees wages from July, rising to 20% for August and September.  

The Office for Budget Responsibility (OBR) estimates that £73.6 billion had already been spent on employment support schemes such as CJRS and others by November 2020 so this will add to this already striking figure. 

While economic and employment activity are expected to rise, greatly, in the next six months as lockdown is gradually lifted, the end of the furlough and other schemes will still create a moment of hazard for businesses and their employees if they can’t find a way to begin to trade profitably by then. 

Construction bore the brunt of insolvencies by industrial sector


The Insolvency Service reported that since March 2020 there were 8,205 company insolvencies up to and including the end of January 2021. 

Broken down by individual industrial sector they were :

The halting of various building projects, both large and small scale, have badly damaged the construction industry over the previous 12 months. 

This might seem surprising given the historic damage experienced by the hospitality and retail industries but these have been well publicised and several were more visible to the public as an empty shop unit will be more noticeable than an empty building site.

There was also £453.4 million in redundancy pay and other support benefits paid out in 2020 which was the highest amount in ten years and an increase of 31% from 2019.

Another government agency, the Redundancy Payments Service, will make financial payments to employees whose former employers have gone into insolvency and cannot pay any legally due claims. 

Yorkshire and Humber businesses were most likely to become insolvent in 2020

With the help of the Office of National Statistics and The Insolvency Service, we looked deeper into the regional insolvency statistics for 2020 and produced a comparative figure - the Corporate Insolvency Ratio - showing the likelihood of insolvency based on the numbers of active businesses in a region/nation and the number of business insolvencies recorded there. 

The table shows the number of businesses registered in each UK nation and English region, the total number of business insolvencies and the Corporate Insolvency Ratio for each.

[ninja_tables id="12447"]

Because of certain statistical caveats, the figures are an approximation based on available data rather than a complete and official record. 

On this matrix, the figures show that a business in the Yorkshire and Humber region of England was statistically most likely to undergo an insolvency event than in any other region (1 in 115) while a company based in Northern Ireland would be least likely (1 in 506). 

Additionally, businesses in the North East, North West and West Midlands of England along with London were at greater risk compared to the national average (1 in 207) while Scotland, Wales and every other English region was less likely than the average. 

Why corporate insolvencies went down in 2020

high street

Given all the news and information we already know about the year of lockdowns, it might be surprising to learn that the total number of corporate insolvencies actually fell in 2020. 

They went down to their lowest recorded levels since 2007. 

So what’s going on? The main reasons can be surmised as follows:-

With the exception of the insolvency moratorium, all of these measures are temporary and will be withdrawn by Autumn this year. 

Ironically, 2021 could have many more corporate insolvencies than 2020 had. 

Chris Horner, Insolvency Director with Business Rescue Expert said: “Ominously, even with restrictions being lifted and economic activity rising, 2021 will be a worse year for insolvencies in several industries than the year of lockdowns was, 

“Government support in the form of backed loans, furloughs and the temporary ban on winding-up petitions and other creditors actions are all expected to end sometime in 2021. 

“Bounce Back Loan repayments and others will begin to come due, businesses will have to decide if they can re employ or redeploy their furloughed workers and creditors that have been under severe financial pressure themselves will finally have the ability to look for repayments that might be critical to their own survival.”

Not on the High Street - Anymore


The previous 12 months has seen the demise of some of the most storied companies in Britain. 

Debenhams was formally wound-up in the High Court with BooHoo buying its online brands and trademarks to relaunch as an online-only retailer. 

The Topshop, Topman and Miss Selfridge brands of the Arcadia group were bought by ASOS with BooHoo returning to purchase the remaining Wallis, Burton and Dorothy Perkins brands. 

No physical properties were included in any of the deals. 

BrightHouse, the UK’s largest rent-to-own retailer went into administration in April along with Laura Ashley while fitness retailer DW Sports announced it would not reopen in August. 

Regional UK airline FlyBe went into administration in March where it remains until a buyer is found. With other carriers unable to operate a regular, reliable UK-wide service yet, 2021 is another year that might have historical consequences.

Research from the Local Data Company shows how devastating the year of lockdowns was for the retail industry. 

They estimated that 17,532 chain store outlets located in high streets, retail parks and shopping centres closed last year - an average of 48 per day. This is compared to an overall total of 7,655 openings to replace them, or 21 per day.   

The net loss of nearly 3,500 locations was a third higher than in 2019. 

“The rise of online shopping and home delivery which provided a shot in the arm for the hospitality industry, might be a more mixed blessing for retail” said Chris Horner, Business Rescue Expert’s Insolvency Director. 

“We won’t know for some time how many new habits and shopping methods we adopted in 2020 will stick in 2021 and become permanent or how many will revert to the previous physical model. 

“Some companies might bet big one way or another and hope to reap the benefits of being a successful early mover. Others might hedge their bets and hold back investing, redeployment and retraining which could prove more sensible in the medium and long term but would impact negatively in the immediate future in terms of investment and activity.” 

We still don’t know how 2021 will unfold as many businesses are still unable to open their doors and trade freely and some won’t until we get into the Summer at the earliest. 

For others, even when they do return, they’ll find that customer behaviour, retail trends and other changes will mean that they will have to recalibrate their own offerings if they want to make up lost ground. 

One thing we can guarantee this year, maybe the only thing that can be, is that Business Rescue Expert will continue to be here to help advise and guide any business that is having financial issues or doesn’t know what their next professional step should be. 

We offer free virtual consultations for any company that needs to clarify its position and understand what options are open to it. 

The benefit of acting first is that you usually find you have more choices and strategies available than whoever acts second. 

Get in touch and find out what they are for your business - today.

Business Rescue Expert is part of Robson Scott Associates Limited, a limited company registered in England and Wales No. 05331812, a leading independent insolvency practice, specialising in business rescue advice. The company holds professional indemnity insurance and complies with the EU Services Directive. Christopher Horner (IP no 16150) is licenced by the Insolvency Practitioners Association


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