- by VisionNet on 01/12/2012
As high-street shops hope for a festive bounce in business in the run-up to Christmas, new figures from Vision-net, Ireland's leading business and credit risk analyst, show that just over one in 10 companies that have collapsed so far this year is in the retail sector.
Vision-net's figures show that, so far this year, 12% of all insolvencies were in the retail sector, compared with 14% for the same period last year.
After the construction, professional services and real estate sectors, retail businesses were most likely to collapse, according to Vision-net's analysis.
In an analysis of the period between November 1 and 27 this year, Vision-net's figures show that 140 companies were declared insolvent, or five companies each day, which is down 20% on the same month last year.
Of those, 103 were liquidated, 34 entered receivership, and an examiner was appointed to three companies.
A county-by-county breakdown of the figures for this month shows that Dublin accounted for 43% of insolvencies, followed by Donegal and Wexford with 10.7% and 9.3%, respectively.
Vision-net's figures show that 113 companies held meetings of creditors this month - six meetings fewer than last November - and the total amount owed is over EUR63 million.
This month recorded 3,056 company and business start-ups - an average of 113 each day which is in line with last November.
The professional services sector accounted for 25% of new companies, followed by the wholesale and retail sector at 12%, social and personal services at 10%, and information technology at 8%.
In the first 10 months of the year, 11,659 companies were formed but 11,440 collapsed, showing a net gain of 219.
Companies in the professional services, construction, wholesale and retail, real estate, social and personal services, and manufacturing sectors made up 71% of closures this year so far.
Vision-net's figures for October show that 497 registered commercial and consumer judgements worth EUR23.4 million were awarded in the courts.
Of these, 348 were judgements worth EUR19.6 million awarded against consumers, with the Revenue Commissioners and banks accounting for just over EUR14 million of that amount.
Last month, 149 judgments worth EUR3.8 million were awarded against companies - an average of EUR25,790 per judgment.
Christine Cullen, Managing Director of Vision-net, said the retail sector has been hit hard in the recession but the run-up to Christmas should help recover some lost business.
"Retailers are reporting that average transaction values are down and our analysis shows that a higher than average proportion of companies in this sector fall into the high-risk category. However, the run-up to Christmas is always the busiest period for retailers so hopefully the high street will show signs of increased consumer demand at this time of year."
"Overall, the economy has been creating marginally more businesses than it is shedding, and the downward trend in the number of insolvencies this month compared to last November is encouraging. With trading conditions remaining volatile, our advice to companies is to professionally research the marketplace before making important decisions that will affect their survival or growth prospects," said Ms Cullen.