The latest Q3 2013 research from InfolinkGazette, the UK providers of Unsecured Creditor information shows that UK companies enter liquidation with an average of 25 unsecured creditors. The average unsecured loss in Q3 2013 was £28,940, compared to the annual average of £43,000 and total Q3 Unsecured Creditor losses were just under £0.5 billion.
The average Shareholder Funds (Net Worth) of Unsecured Creditors as at Q3 2013 was £477,000, meaning the average unsecured credit loss of £28,940 reduced Shareholder Funds by 6.1%.
The average estimated Turnover (Sales excluding VAT) of Unsecured Creditors as at Q3 2013 was £3,529,500, meaning that just one unsecured credit loss, at the average of £28,840 is equivalent to 0.82% of Turnover.
The average Working Capital (Current Assets minus Current Liabilities) of Unsecured Creditors at Q3 2013 was £44,000, meaning that just one unsecured credit loss at the average of £28,840 would wipe out 65.8% of the Working Capital.
Greg Connell, Managing Director, commented, “these figures help to explain why unsecured creditors are 3.6 times more likely to fail than the national average – the average UK company simply doesn’t have the liquidity to be able to absorb the losses accruing from customers going out of business and in to liquidation. Greg added, “UK companies need a combination of accurate up-to-date credit information on their customers to help them avoid bad debt; fast response debt recovery to collect overdue accounts from at risk customers and trade credit insurance to mitigate against losses when they occur.”
For further information call Greg on 07753 739752