Truro accountant on the business world’s ‘summer of sorrow’

More companies went under across Britain in August than the month before, and the man putting it into plain English works out of an office in Truro.

There were 1,946 corporate insolvencies in August, up 0.6% on July’s 1,934, though still 3% down on the 2,007 recorded in August 2025. Andy McGill, a restructuring and insolvency partner at Azets, the UK top ten accountancy and advisory firm with an office in Truro covering the South West, has been explaining why.

A four-month high, driven by real estate

“Corporate insolvency numbers hit a four-month high in August, driven by a rise in administrations as more than 250 connected companies in the real estate sector entered administration between March and August of this year,” Andy said.

He pointed to a knock-on effect too. “August also saw an uptick in compulsory liquidations, as creditors continue to chase down debt in an attempt to balance their own books and HMRC continues to pursue tax debts to recover money for the public purse.”

The heatwave that hurt businesses instead of helping them

For plenty of firms, this summer brought a mix that rarely lands together. “There’s no denying it was a summer of sorrow for many firms as ongoing and long-running cost issues and uncertainty caused by the political and geopolitical climate met the heatwave and resulted in fewer customers, a drop in sales and an increase in the cost of keeping buildings, customers and staff cool from the heat,” Andy said.

He named TG Jones and Beefeater as two once-familiar British names that have been cutting their high street and roadside presence, with Aston Martin also showing signs of strain.

Higher earners are starting to feel it too

Until now, premium businesses had largely escaped the worst of the cost of living squeeze. Andy thinks that’s changing. “The cost-of-living issues are now starting to take their toll on higher earners and this is hitting higher-end brands who had avoided its effects to date,” he said. “With inflation, living and energy costs increasing and wage rises being few and far between, those on higher incomes are now likely to start shopping around and watching their outgoings more closely than they ever have.”

Retail, construction and hospitality, all under the same pressure

Three sectors are feeling it from different directions, Andy said. Retailers saw a monthly fall in sales, and while volumes are up year on year, falling margins and rising costs, employment taxes especially, mean it isn’t the good news the sector needed.

Construction is short of new work, with rising material and wage costs eroding margins that were already thin, “pushing them closer towards financial distress.”

Hospitality, meanwhile, was hit by the very weather that should have filled its tables. “The hospitality industry has been hit hard by the hot weather as people stayed at home and hid from the heat in a month which is normally ripe for going out and spending money,” Andy said, adding that whether customers get back into the habit of going out as the weather cools will decide whether the sector gets the revenue boost it was hoping for.

An eye on the Budget

Firms are also watching for what comes next. Andy pointed to the wage, tax and business rates increases announced in the 2024 and 2025 Budgets as having already hit profits, growth and recruitment, with many hoping the Chancellor spares them further increases when the next one lands.

What to do if you’re worried about your business

Andy’s advice for anyone concerned about where their business stands is straightforward. “Pick up the phone and speak to an advisor,” he said. “It is an incredibly difficult conversation to have, but seeking advice about your concerns gives you more options, more time to take a decision and a better chance of turning your situation around than if you’d waited until the issues became more severe and the window for decision making became shorter.”