Friday, 13 April 2012

Early warning indicators


Very often the best indicators are the least sophisticated. The UK economy remains in a very fragile state – the clearest evidence of this can be seen as you walk down any High Street.

The number of retailers entering administration in England and Wales in the first quarter of this year was up 15% on a year earlier.

69 firms failed during the three-month period, compared with 60 a year earlier.

The number of job losses that came as a result of these administrations was almost 10,000 out of the 22,000 employed by those companies

The rising number and popularity of charity shops tell underscore that many families are struggling. Consumers struggle with debt and job insecurity.

As the knock on effect percolate back down the chain many businesses will suffer. External factors by definition are difficult to handle but at the same time in-house disciplines can at least provide some insulation.

Cash-flow will remain difficult to manage so as always strict governance of Debtor and inventory control will provide some measure of comfort




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