A LEADING Sheffield insolvency expert has warned that the number of companies facing failure will continue to grow in 2020.

The latest statistics from the Government’s Insolvency Service have revealed that the number of companies going into administration has jumped by over 20 per cent in the past year.

In the 12 months to the end of September, 1,713 companies entered into administration, an increase of 21 per cent on the previous year.

Overall, the number of companies using an administration procedure was at the highest level since 2014.

An administration is a formal insolvency procedure by which a company is placed under the control of a licensed insolvency practitioner, with the aim of either rescuing the business or winding down the business to avoid further losses and to repay creditors where possible.

Deborah Lockwood of Sheffield-based insolvency practitioners Graywoods commented: “The upward trend in the number of companies getting into serious difficulties is now clear.

“This will be the third year in a row that the number of company failures has increased.

“It is clear that certain sectors of the economy are under serious pressure and we are predicting that the number of companies becoming insolvent will continue to rise in 2020.

“Whatever the causes, it is heart-breaking to see businesses closing down despite the hard work of their owners, investors and employees.

“The ‘domino’ effect within a supply chain can also be devastating and cause far-reaching problems.

“Our message is always that business owners should seek advice at the earliest opportunity.

“We are proud of our expertise in company turnaround and business rescue, but all too often it is too late to reverse the situation by the time the directors contact us for help.

“The sooner we get involved, the more likelihood there is of finding a way of saving the business.”