Rotterdam, April 17, 2023 - In the Netherlands, 204 companies went bankrupt in March 2023. This was revealed after analyzing the latest figures from business data expert Altares Dun & Bradstreet. This is an increase of about 10% compared to the same period last year. The total number of bankruptcies in the first quarter of 2023 (698) has thus also increased, where there were still 485 in the first quarter of 2022, the upward trend goes back to the level before corona.
First quarter 2023: number of bankruptcies increases
The support provided by the government during the corona crisis kept the number of bankruptcies relatively low. However, this support also had the side effect of keeping financially unhealthy organizations from going bankrupt. As these buffers fall away, a rise in bankruptcies is now visible. January 2023 counted the most bankruptcies in the past year: 251. Still, pre-corona levels have not yet been reached. In January 2020, 306 companies closed their doors, and in March 2020 the number was as high as 332.
Standouts
Altares Dun & Bradstreet looks at monthly bankruptcies in the Netherlands and sees in which provinces and sectors they are pronounced. The trade and construction sectors traditionally have the most bankruptcies. In March 2023, 44 trading companies went head-to-head, 28 bankruptcies occurred in the construction sector and 26 in the manufacturing sector. This trend was already visible in the months before, and over the entire year 2022, trade was already the leader with 386 bankruptcies.
Joris Peeters, Chief Data Scientist at Altares Dun & Bradstreet, explains, "We see in our data that the number of bankruptcies is picking up. We're not at pre-corona levels yet, but we are noticing across the board that the removal of financial support, inflation and rising costs are causing more companies to fail. This is particularly visible in the trade and construction sectors. This makes sense because those are the sectors in which there are now many businesses, but it may also have to do with people's reluctance to make purchases."
Upcoming months
Looking ahead to the next few months, Peeters expects a further increase in bankruptcies. Peeters: "We expect that in the aftermath of the corona crisis we will slowly but surely return to the level of bankruptcies before the corona crisis. In relation to how economic growth develops in the coming months, if growth is disappointing, this could push the number of bankruptcies higher. With stronger economic growth, this number may also be lower. This is not surprising, given the historical relationship between the number of bankruptcies and overall economic growth."
"Now it is the case that companies have to pay back the concessions they had from the government during the corona years. This may become difficult for some entrepreneurs. It is difficult to estimate how many companies will go bankrupt, but an increase is almost certain. The attitude of the government and tax authorities regarding repayment arrangements may also affect struggling entrepreneurs. This makes predicting exact bankruptcy figures difficult, but the trend of increasing bankruptcies has clearly begun," Peeters said.
The full bankruptcy report of Altares Dun & Bradstreet for March 2023 is available for download here.
