Bad debt surges in first quarter
Levels of debt owed to UK businesses spiralled in the first quarter when compared to late 2017, new data has revealed.
According to the Creditsafe Watchdog Report, debt rose to £738.7 million by the end of the first quarter, up by £580 million on the previous three months.
While it is important to note that the figure for the fourth quarter of 2017 represented a 12-month low, bad debt has increased by 366.1% year-on-year.
The average amount that a business is owed has also grown to an average just shy of £930,000 per outstanding payment - a jump of 365.9% from 12 months previously.
Sales also took a hit in the first quarter, as UK businesses -and especially those in the retail sector -noted a drop of 23% to £7.38 trillion.
The number of Country Court Judgements also increased by 23% in the first three months of the year to total 18,731, with the average value of each at just over £40,000.
Having looked at 11 main business sectors, the number of businesses entering insolvency or failing increased by more than 28% to total 4,567.
High profile collapses including those of Carillion and Toys 'R' Us have dented confidence and Creditsafe UK chief executive Chris Robertson described the latest figures as "particularly
More than 1,000 companies have already failed in 2018, as the business climate changed from that seen in the final months of last year when sales rose and bad debt levels fell.
For businesses that are facing up to bad debt or other financial issues, there are solutions available but the key is to act quickly.
By Phil Smith