Liquidations in May 'up 50% on 2010'

One in every two companies in Ireland are now showing signs consistent with business failure, according new data carried out by business intelligence and risk agency visionnet.ie.

In its latest monthly bulletin the company also said that court-ordered liquidations are up 50% on the same period last year.

And fewer people are now willing to take the risks involved in starting up a new business.

“The rise in court-ordered liquidations signals a hardening of the position being taken by debtors and perhaps a more clinical stance on the part of the courts," said visionnet.ie Managing Director Christine Cullen

"More than one in every two companies are now in trouble and at risk of not being able to meet their daily financial and trade commitments.

"This does not necessarily mean that these companies are facing closure, but it does have a real domino effect in terms of cashflow and debt management."

Visionnet.ie figures for May show that the number of people choosing to become a company director for the first time has fallen by over 40% when compared with the same period last year.

"The sharp drop in first-time company directors is telling," Ms Cullen said.

"It is impossible to say with certainty what may be influencing this, but the lack of finance options for would be entrepreneurs and people adopting a more cautious approach are among the likely factors.

"The business climate is such that the risk takers so crucial to generate economic activity are not as active as they once were."

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