More and more firms are collapsing

Europe struggles with an increasing number of bankruptcies. In Poland manufacturing industry suffers the most, but building sector is still having problems as well.

Europe struggles with an increasing number of bankruptcies – as announced by Euler Hermes company, in the euro zone the number of insolvencies rose by 16 per cent in 2012, and is to increase by 21 per cent this year.

In relation to the situation from 5 years ago, the bankruptcy weight has shifted. If in the first stage of the crisis in the majority of countries the number of insolvencies rose the most dramatically in manufacturing, in industry, now in most countries this happens to services – explains Grzegorz Błachnio, Euler Hermes' expert.

It stems from the fact that the biggest number of enterpreises currently operates precisely in services.

At this moment, 2/3 of insolvencies takes place in services, such as transport, printing industry, but also in services for the population, beauty services, and others. 22 per cent of bankruptcies are those from building industry, and only 11 per cent are those from manufacturing industry, industrial firms - enumarates Grzegorz Błachnio.

This tendency does not apply for Polish market. In our country services still prosper quite well, whereas mainly the representatives of industry, which plays a leading role, have reasons to complain.

Since the beginning of 2013 almost half thousand enterprises collapsed in Poland, that is 2 per cent more than in the previous year. We can easily see the deepening problems of manufacturing sector, wholesale and, to a much lesser extent, of services. The situation is also disadvantageous for building sector. The number of realised investments have decreased, both in private and public sector. Also smaller firms and subcontractors may complain about problems with stability, suffering as a result of last year's problems of general contractors. Bankruptcies more often affect residential building and finishing firms.

At this time problems haunt construction firms, which bear fixed costs of equipment or employment, but still have not enough works contracted – comments Grzegorz Błachnio.

In the first half-year, 124 construction firms went bankrupt, which means a decrease by 7 per cent in relation to an analogous period in the previous year. Since the beginning of the year the most bankruptcies have affected manufacturing industry, in which 132 firms collapsed.

It stems especially from the poorer demand on home market. Here we mean consumer goods, even beauty sector, food industry or household chemicals – explains Grzegorz Błachnio.

It is also related to problems suffered by Poland's main business partners, inter alia Germany or France.


 


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