North East entrepreneurs have been battling back against challenging economic conditions during the second quarter of the year to set up more than 4,100 new businesses.
According to analysis by insolvency and restructuring trade body R3 of new data provided by CreditSafe, 4,135 new businesses were established in the North East between the start of April and the end of June, with the biggest monthly number (1,509) coming in May.
The figure is marginally lower than the 4,187 new businesses set up in the region during the first quarter of 2022.
R3’s research also found that the number of insolvency-related activities in the region during Q2 was around one third lower than the figure for the first quarter of the year.
There were 176 insolvency-related activities, which includes liquidator appointments, administrator appointments and creditors’ meetings, across the North East during the second quarter of the year, compared to 266 in the preceding three months.
On the downside, the number of North East firms with overdue invoices on their books rose for the sixth consecutive month during June, with more than 13,400 regional businesses still holding over 224,500 invoices that should already have been settled.
North East chair of R3 Chris Ferguson, who is head of recovery & insolvency at Gosforth-based RMT Accountants & Business Advisors, says: “Our region’s entrepreneurs are well used to dealing with economic headwinds and their ambition to turn ideas into commercial reality has remained unwavering despite the current economic situation.
“The fall in the number of North East firms experiencing insolvency-related issues last month is also good news, but the size of the economic challenges that lie ahead should not be underestimated and it’s as crucial as ever that business owners continue to closely monitor both financial and management data.
“Being unable to pay your bills on time is one of the key indicators of business distress, while late payments are often a major contributory factor to the failure of many otherwise-viable businesses.
“Talking about your financial concerns can be very difficult, but the earlier business owners seek qualified advice the more options there are to put things right.”