“You must be really busy?”

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Over recent years many people have said “you must be really busy.”

Our answer to this justifiable assumption has always been: “We are steady, however the industry as a whole is the quietest it’s been for seven years”

When the recession began back in 2008 creditors were more aggressive, being quick off the mark to take legal action, such as obtaining CCJ’s, appointing administrators or issuing winding up or bankruptcy petitions.

After a couple of years it appears many creditors realised they were throwing away good money after bad. As a result they became a lot more relaxed allowing businesses and individuals to pay what they could afford in the hope that when the economy improved payments would increase or there would be assets to go after.

For the rest of 2014 we are expecting the answer to the same question above to be: “ Yes, we are busy.” Why is this you may ask?

Coming out of a recession many businesses begin to overtrade. Following a long drawn out period of low order books and not many new clients, the feel good factor returns. Orders increase and preparation for growth starts. Many however will run out of cash.

The next reason may surprise you.

History shows that when borrowing is easier to get hold of, company insolvencies increase. That’s right, yes. The reason the recession began in the first place, a lack of lending, will come to the fore again, in another guise as a contributor to an increase in insolvencies.

Finally we are expecting interest rates to start to creep up over the next 12 – 18 months. If they do, then more individuals and businesses are likely to start to struggle.

So after years of stagnation or negative growth, we are expecting an upturn in the economy. Ironically the knock-on effect for the insolvency industry is it will become busier. Hard to fathom really but, hopefully, our brief explanations as to why, makes sense!