The number of businesses entering liquidation across South Lanarkshire hit a four year high last year.
According to new figures from the Shared Data Unit, the number of local businesses that went into voluntary liquidation in 2022 was 32.
In 2019, the number of companies entering liquidation was 11, in 2020 it was nine and in 2021 it was 26.
And nationally, Scotland saw the biggest rise of insolvencies across the UK with 150 per cent.
Liquidation is the process of bringing a business to an end and distributing its assets to the people and businesses it owes money to.
It tends to happen when a business is classed as insolvent, which can be when a company cannot afford to pay its bills or its assets are worth less than its net debts.
And voluntary liquidations, which are the most common type of insolvencies, happen when the company owners have voluntarily placed the business into liquidation.
There are a few reasons as to why so many businesses went into liquidation across South Lanarkshire last year, including the conflict in Ukraine which pushed up the price of both oil and grain, increasing costs for businesses, as well as soaring fuel costs and drastically higher energy bills.
Regional managing partner for the southwest region at insolvency experts Begbies Traynor , Julie Palmer, said: “Energy and the cost of energy is only going one way at the moment. Energy is going to remain a very real problem for business and will affect supply prices right across the board.
“We see it when we look at the prices in our shopping basket at the moment. Some businesses are actually reporting increased turnover, but lower profits. If you look at the food retail market the figures might look good on the face of it because spend is up, but actually spend is up for much fewer items in the basket. I can’t think of a single sector where rising prices aren’t an issue.”
Federation of Small businesses member and managing director of EXP2 Limited, Michael Weedon offered suggestions on how the UK government can help to keep businesses afloat.
He said: “Reinstating energy support levels at the rate they were previously, would make a huge difference. The support for business is being wiped away – while energy rates are not likely to fall any time soon.
“We also have a long-standing aim to see the small business rate relief, which currently kicks in at a £12,000 rateable value and disappears completely by £15,0000. We want to take that up to £25,000, because it would take a swathe of those small businesses in the high street right out of the business rate system – which we think will be at a low cost to the government.”
In response, a government spokesperson said: “The Business Minister recently wrote to the CEO of Ofgem to raise this issue and ask them to ensure energy suppliers show forbearance to businesses that are struggling to pay energy contracts, and government support does not go to waste.
“We have already provided around £400 billion of direct support to businesses, including business grants, coronavirus loan schemes, the Coronavirus Job Retention Scheme, plus income tax payment deferral. This is alongside a new arbitration scheme to help resolve pandemic related rent debt.”
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