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Business risk falls, but restaurants still top Shire risk list

Business risk falls, but restaurants still top Shire risk list

A report from insolvency specialists SV Partners has shown that just 1.6 per cent of businesses in Sutherland Shire are at risk of insolvency, down from 2.4 per cent just six months ago.

The SV Partners Commercial Risk Outlook Report – March 2019 shows that just 77 local businesses are at a high to severe risk of insolvency in the next twelve months, however, the data also shows that almost one in 10 accommodation and food services businesses were at risk.

SV Partners Director Darren Vardy said it was promising to see insolvency risk falling in the Shire.

“It’s good to see that local business owners are weathering the declines in local property prices well,” said Mr Vardy.

“Local demand is holding up and businesses are on a strong footing.

“Recently announced upgrades to our local hospitals and establishment of the Sutherland to Cronulla Active Transport Link are only going to contribute further to business activity.”

“The common-sense approach to business management that we are seeing in the region has contributed to the outstanding stability of local businesses.”

According to the report the largest number of at-risk businesses came from and accommodation and food services and construction, with 15 and 14 businesses at high to severe risk of insolvency in each industry respectively.

Mr Vardy said while there were positive signs in the data, businesses needed to stay vigilant.

“While these businesses often struggle with insolvency risk given the difficult nature of hospitality, there are strategies all businesses can employ to ensure they remain solvent,” said Mr Vardy.

“All business owners in the region, need to ensure they have the basics covered – dependable cash flows and manageable debts.”

The report’s findings show a total of 8,782 businesses or 1.8 per cent of incorporated Australian businesses across all industries are at high to severe risk of financial failure over the next 12 months.

The report draws upon millions of commercially-sourced records and data assets to create and analyses comprehensive risk profiles of more than half a million Australian incorporated businesses.

The report identifies and analyses the sectors and geographical location of businesses facing the risk of financial failure during the next 12 months.


About the SV Partners Commercial Risk Outlook Report

The SV Partners Commercial Risk Outlook Report analyses the overall economic conditions of Australian business activity based on the most comprehensive and latest commercial bureau data including trade payment history and data from over 50 variables.

The report predicts the likelihood of adverse financial events including external administrations, petitions to wind up, mercantile enquiries, defaults, bankruptcies, court writs, default judgements.

The report categorises businesses into eight risk bands ranging from minimal to severe risk. High risk business behaviours include late payments on loans and debts, cash flow problems and unfavourable trade payment behaviours. Businesses categorised within the highest risk categories are extremely likely to undergo a serious adverse financial event within the next 12 months of trading.

Data is compiled from millions of commercially sourced records and data assets from sources including ASIC, the Australian Bureau of Statistics, Business Directories, Consumer/Commercial Credit Bureau, the Australian Post Office, Australian Business Register, Telephone Directories and Business Research.

About SV Partners

SV Partners is a specialist accounting and expert advisory firm that provides professional corporate and personal insolvency accounting, turnaround strategy and forensic advisory services to accountants, financial institutions, corporations, financial and legal advisors, and their clients.

SV Partners is represented throughout Australia, predominantly along the Eastern Seaboard, with offices in the metropolitan and regional areas of each state, with approximately 100 staff members nationally.

If your business is experiencing financial difficulty it is vital to seek professional advice immediately. Contact one of our experts on 1800 246 801 for a free consultation.