Over 850 small firms failed in last quarter due to lack of planning

Over 850 small businesses that failed in the last quarter of 2008 could have stayed afloat if they had sought expert advice and implemented management initiatives, according to research by Tenon Recovery.

The research found that approximately one in eight small companies fail to carry out any business forecasting and one in three only carry out forecasting once a year.

It is estimated that a business has an average of 33 weeks to determine whether a series of turnaround initiatives will be enough to save the firm if entrepreneurs spot the warning signs early enough and act upon them.

"Identifying any potential issues for a business early enough can mean the difference between a turnaround, restructuring or insolvency. It is a case of a stitch in time can save an entrepreneur's dreams from unravelling," said Carl Jackson, national head of Tenon Recovery.

"Now is the time to take a proactive approach and do everything possible to protect a business. Without regular business health checks and forecasting many more entrepreneurs will find themselves adding to the insolvency statistics."