The number of business failures is poised to reach 70,000 over the next three years as a downturn in consumer confidence and a sluggish UK GDP start to take their toll.
According to BDO Stoy Hayward's Industry Watch report, a total of 19,928 businesses failed in 2002, a rise of 6per cent from 2001 levels. And more trouble is in sight, with annual business failures predicted to rise above the 20,000 mark in the coming two years, growing to almost 25,000 by 2005, a return to levels not seen since 1993.
Below-par UK GDP growth, weak domestic and international demand, and tumbling share prices have fed their way through to lower company profits says BDO Stoy Hayward, and the UK economy is now set to turn into one of the weaker performers in the G7 in the next three years. The forecast for 2005 implies that an average of 471 businesses could go bust each week, compared with 383 a week in 2002 and the low of 303 a week in 1997.
