Businesses will need to be alert and agile if they are to thrive in the new age of uncertainty, warns the new North West Chair of R3, the insolvency and restructuring trade body.
Paul Barber, a Partner and insolvency practitioner at Begbies Traynor in Manchester, says we are now entering a period of great change, with technological disruption, political upheaval and the prospect of Brexit among the main drivers.
He takes over from Richard Wolff, the outgoing regional Chair who is also Head of Corporate Recovery and Insolvency at law firm JMW. The new Deputy Chair will be Allan Cadman, a Partner and insolvency practitioner at Poppleton & Appleby.
Paul Barber says change management will be a key skill for business in the years ahead. “While the full impact of Brexit will not be apparent for some time, businesses are already dealing with the immediate impact in the shape of exchange rate fluctuations. At a local level, we will see the introduction of city mayors and combined authorities while internationally, we can expect further political turmoil and the prospect of protectionism in the US. Meanwhile, new technologies are changing the landscape and forcing many firms to rethink their business model.
“Key issues in the year ahead will include pensions auto-enrolment which will be obligatory for all businesses by the end of 2017, and HMRC’s clampdown on tax avoidance as a surprising number of small firms have been caught out by their use of contractor tax schemes in the past and some are facing the real risk of insolvency.
“Of course change brings both challenge and opportunity, but businesses need to be alert to the market signals, ready to react swiftly and restructure their operations where required.”
He said that while the number of insolvencies had been lower than expected in recent years, the insolvency profession had become highly skilled at rescuing ailing businesses, with the North West leading the way. Research by R3 shows that the region has the highest rate of business rescue in the country with half of the businesses (52%) declared insolvent surviving in some form.
Paul Barber added: “Where firms do get into difficulty, the key to survival is to address the issues at an early stage. Evidence shows that in most cases calling in help at the right time, especially from professionals experienced in change management, can save the business and the jobs of its employees.”