The number of businesses in ‘critical’ financial distress across the UK increased by 78% with 55,530 companies affected.
According to Business Biscuit, the company Begbies Traynor shows that more Uk businesses are struggling financially. In early 2025 about 45,000 companies are in serious trouble which is 13% more than last year.
The hardest hit industry are those that deal directly with customers, like bars, restaurants, travels, and tourism.
Even though there was a small improvement at the start of 2025, experts warns that new taxes and possible US trade tariffs could make things worse later this year.
Many businesses may soon face top choices-whether to restructure, sell or close down if the economy doesn’t improve.
Meanwhile it was reported by Business Biscuit that almost 5,000 of the affected businesses are based in Bristol.
For Hassan, owner of a food retail shop in Gloucester road, the past 12 months have been marked by rising costs and shrinking margins. He says that “every bill feels like a hurdle.”
“Everything’s gone up — transportation, electricity, rent,” he said. “We’ve had to raise prices slightly, but people are spending less, so it’s a constant balancing act.”
Hassan said winter energy bills are his biggest worries. “That’s when things get tough.” he explained, “We’ve seen so many independents (businesses) close this year already.”
Jayson, who manages a charity shop on Gloucester Road, said the situation is just as challenging for the voluntary sector.
“Quality of Donations have dropped, but more people are coming in looking for affordable essentials,” he said. “Running costs are up, so every penny has to stretch further.”
Jayson added that the shop is seeing more visitors who are struggling financially.
“Behind every statistic there’s someone trying to make ends meet. It’s tough out there.”
Despite the challenges, Hassan and Jayson both believe in Bristol’s resilience. “People here care about local businesses,” Hassan said. “We just need things to settle down so we can catch our breath,” explained Jayson.
Julie Palmer, Partner at Begbies Traynor, said:
“The steep increase in businesses in ‘critical’ financial distress shows the UK economy is in real trouble. With over 55,000 companies now in serious financial distress, the upcoming Budget must deliver urgent support to avoid a wave of failures, especially among SMEs already operating on a knife edge.
