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Business failures up by 10% y-o-y in 2011


2012-01-24



A total of 723 companies were declared bankrupt by the Polish courts in 2011, an increase of 10.4% compared with 2010 and fully 76% higher than in 2008, according to latest figures from Coface, the global provider of credit solutions. It is the highest figure since 2005.

Last year was characterised by a gradual increase in the level of business risk facing firms operating in Poland, as reflected by rising volume and value of outstanding payments in the business sector and a deterioration in the Coface Payment Incident Index, the company notes. By way of comparison, in 2010 business failures were down by 5.2% to 655, thanks to better payment discipline.

There were significant differences between sectors, however. The construction industry was hit hardest, with the number of bankruptcies up by 46% over 2010, to 143. As a result, the sector accounted for nearly 20% of all business failures in Poland last year, compared with just over 10% two years earlier. (In real estate bankruptcies more than doubled last year, but from a much lower base, totaling 28). In the trade sector business failures increased by 22.4% in 2011, to 180, though they remained just below their level in 2009. (In the sub-category of retail trade the figure surged by 84% to 46). Trade accounted for 25% of all failures in 2011.

At the same time, in manufacturing the number of business failures declined by 12.8% to 218, or 31% of the total, compared with 41% in 2009. Particularly notable improvement was noted in other non-metallic mineral products (a category that includes building materials), with just six bankruptcies, down by 70%; and in wearing apparel and textiles, where the figure nearly halved to 15. In metals and metal products the fall was more modest, by 6% to 47, indicating continued stabilisation after the turbulence of previous years. By contrast, in the manufacture of rubber and plastic products business failures went up by 40% to 21.

In transport and storage the figure remained unchanged at 40.

Geographically, in 11 out of 16 voivodships business failures increased, led by Podlaskie, Lubuskie and Lubelskie; in four they decreased, led by Warminsko-Mazurskie; and in one (Podkarpackie) the number of business failures was the same as in 2010.

Small and medium-sized companies were more likely to declare bankruptcy in 2011 than were large firms.



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PMR is a British-American company providing market information, advice and services to international businesses interested in Central and Eastern Europe as well as other emerging markets. PMR key areas of operation include business publications (through PMR Publications), consultancy (through PMR Consulting) and market research (through PMR Research). With over fourteen years of experience, high international standards in projects and publications, highly skilled multilingual staff and a wide network of co-operating research companies and market experts, PMR is one of the largest companies of its type in the region.