Bolton may prefer to flaunt its more glamorous associations with Reebok, the DJ Sara Cox and John Smith's star comedian Peter Kay but from today the Lancastrian town will have to come to terms with another sort of relationship altogether: that of the administrator.
A survey by a leading professional business recovery body today bestows the inauspicious title of Britain's most insolvent town on Bolton.
Figures released show that businesses in the Lancastrian town, which gave birth to the Reebok trainer in 1895, are twice as likely as the national average to go bust, with those in Manchester faring almost as badly.
R3, the Association of Business Recovery Professionals, reported that last year, 4 per cent of all companies in Bolton – or one in 25 businesses – went bankrupt. That compared with just one in every 104 businesses that failed to make the cut in south-west London.
David Buchler, R3's president, said the results showed the North-South divide was alive and well, thanks to the high concentration of manufacturing businesses in the North of England. "Those sorts of companies were really finding life very difficult during 2002, with a lot of manufacturing moving away from the North-east to low wage cost countries in the Far East," he said.
But it was companies north of the border that fared the best. Just one in 92 Scottish companies go bust compared with one in 50 in England and Wales. Perth, where just 0.53 per cent of all companies had to call in the administrators last year, was the best place in Britain to do business in 2002, R3 found. Not for nothing are the Scots renowned for their parsimony, it seems.
The survey, the first of its kind, also revealed that the average insolvent company in Britain was a Midlands-based wholesaler or retailer with turnover of less than £1m and gearing of 77 per cent.
R3 did have some good news, however. It revealed that changes to the Enterprise Act meant creditors stood a much better chance of retrieving their debts when companies go bust. So-called "crown preference", which previously meant that the VAT man and Customs & Excise were first in the pecking order for a payout, will be abolished, possibly as early as April. Unsecured creditors should then receive 18p in the pound compared with 6p currently, Mr Buchler said.
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