The latest Business Failures Report from Equifax, the business information specialist, reveals that businesses in the manufacturing sector have seen a 10.9% drop in failures in Quarter 2.
However, with failures rising year on year in Quarter 1 by 10.7%, Equifax is warning that companies need to ensure that they are conducting the right checks on potential customers and suppliers to protect themselves from bad debt and failure. This is particularly crucial as business failures overall in Quarter 2 2007 increased by 4.5% and those businesses failing could well be customers of manufacturing businesses.
Equifax is advising businesses to utilise tools designed to reduce financial risk. Small and new businesses, in particular, are the most vulnerable to the affects of bad debt, which can often lead to failure. They are also restricted in who they can do business with as larger companies are less inclined to give them orders or credit.
Neil Munroe, External Affairs Director of Equifax comments, Good use of business information could be instrumental for the manufacturing industry. Indeed the first half of this year has demonstrated for the manufacturing sector how quickly the outlook can change with failures rising significantly in Quarter 1 but dropping in Quarter 2. Blended data is the latest form of financial business information from Equifax designed to encourage big organisations to trade with smaller businesses and have a positive impact on their success. The more businesses a small company can trade with the more likely it is to succeed.
Blended data combines business data with the personal credit information of a business directors or owners to create a clearer picture of its financial status. This combination of data provides larger companies with a greater insight into a business financial stability, opening doors for new businesses needing better credit limits and the means to expand their supplier and customer base.
Munroe concludes, Small businesses shouldnt be afraid to let a large company check their financial status and track record. By giving their consent for personal information to be accessed through blended data small businesses can allow the big players to make informed decisions about potential customers.
Although the manufacturing industry fared well in Quarter 2, general business failures figures make gloomy reading and companies of all sizes need to protect themselves with ongoing monitoring of customers and suppliers. Blended data brings businesses in manufacturing a new level of business information to help them secure a successful future.
Equifax Inc. is a global leader in information technology that enables and secures global commerce with consumers and businesses. We are one of the largest sources of consumer and commercial data. Utilizing our databases, advanced analytics and proprietary enabling technology, we provide real-time answers for our customers. This innovative ability to transform information into intelligence is valued by customers across a wide range of industries and markets. Headquartered in Atlanta, Georgia, Equifax employs approximately 4,600 people in 13 countries throughout North America, Latin America and Europe. Equifax was founded 107 years ago, and today is a member of Standard & Poors (S&P) 500 Index. Our common stock is traded on the New York Stock Exchange under the symbol EFX.