The West Midlands experienced one of the most dramatic drops in the number of insolvencies in September.
Firms in the region and the South West saw the biggest improvement over September 2011, with a 34 per cent drop in the number of insolvencies in the latest BusinessIQ Insolvency Index from global information services company Experian.
The impressive Midlands figure compared to a 3.1 per cent drop across the country.
Overall the survey revealed a stable picture with 0.08 per cent of the business population (1,679 companies) failing.
For the Midlands the percentage figure was just 0.07 per cent, hitting the lowest rate since June 2007.
Smaller firms falling into the categories of between 1 and 50 employees, saw the greatest improvement in their average insolvency rate compared to September 2011.
This was led by firms with 26 to 50 employees that saw their insolvency rate fall from 0.23 per cent to 0.19 per cent, while firms with 6 to 10 employees saw their insolvency rate fall to 0.13 per cent, the lowest since January 2011.
The only year on year increase in insolvency rates came from larger firms; all those with between 51 to 500 employees.
Max Firth, managing director, Experian Business Information Services, UK&I said: “Overall insolvency figures are down and the picture remains stable, which is encouraging. In addition, we’ve seen real pockets of improvement, such as in the West Midlands and South West, which have both seen a drop of over 30 per cent.
“Also encouraging are the lower rates of insolvencies among some of the small firms. However in contrast, larger firms experienced a slight increase in insolvencies, which may lead to smaller firms that were supplying to them, experiencing a knock on effect.
“This highlights the need for firms need to be prudent and consider their credit management practices in order to survive. Risk planning and monitoring their financial health and that of their customers and suppliers can make or break a business.”
The picture in the South West was also good compared to the rest of the UK – with a fall in its insolvency rate from 0.09 per cent in September last year down to 0.06 per cent in September 2012.
Yorkshire and the South East were the only regions to see an increase on September 2011, with Yorkshire at 0.12 per cent seeing a 22.8 per cent increase in business insolvency rates and the South East is up 7.2 per cent to 0.08 per cent.