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Retail leads 16% rise in business failures

Figures from PwC show that the number of business failures last year increased by 16% compared with 2023. 

The business-services firm said, however, that insolvencies in the final three months (Q4) of 2024 were “significantly lower” than expected. 

As a result, the total of 852 for the full year fell well short of the 900 that PwC had signalled in its previous update.

21% drop in Q4 

The firm’s insolvency barometer showed that there were 193 business failures in Q4 of last year – down 21% compared with the same period in 2023. 

“This highlights the resilience of the Irish economy and many Irish businesses,” PwC stated.  

Its report found that the average lifespan of companies declaring insolvency last year was 13 years, with the shortest being ten months and longest being almost 60 years.

The annual insolvency rate last year was 29 per 10,000 businesses – well below the 20-year average of 50 per 10,000 businesses.

SCARP ‘under-utilised’ 

According to PwC, the number of SCARPs initiated in 2024 was just 30, compared with 33 in 2023. 

The firm says that around one in every 20 insolvent companies are opting for a rescue process such as SCARP or examinership. 

“This under-utilisation suggests that most insolvent companies have fundamental profitability issues and are opting for liquidation rather than a rescue process,” it adds. 

Hospitality steady 

Receivership appointments in 2024 fell by 13% compared to 2023, with 98 recorded. 

A breakdown of the PwC figures shows that the retail sector recorded the highest number of insolvencies in 2024, accounting for 200 of the 852 insolvencies (24%), with a rate of 32 per 10,000 businesses. 

The figure for hospitality was steady at 150 insolvencies for the year (18% of the total). This represented 77 per 10,000 businesses, one of the highest of any sector.