Is credit risk the biggest concern for construction companies in 2013?

Construction News sent out news today of the top 12 construction stories of 2012 and 5 of those 12 related to company insolvencies!

  • Administrator in talks to sell parts of Doyle
  • Rotary “for sale” as parent firm Hastie enters administration
  • M J N Colston to file for administration
  • Kilby and Gayford goes into administration
  • Burdens falls into administration

Each time a nationally known contractor goes bust, they leave a raft of unpaid creditors (suppliers and sub-contractors) which drains more cash out of an already cash strapped sector – so no wonder that these stories attract the highest reader numbers! M J N Colston alone left more than £40m in unpaid creditors (according to the creditors list prepared by the company’s administrators, Deloitte Llp.)

As the outlook for 2013 is “bumping along the bottom”, I think I heard it referred to as a “corrugated sheet” – there will be more well-read stories about unexpected company insolvencies in 2013 in the construction sector.