Retail and the North West bear the brunt as business administrations remain high in 2025

  Posted by: electime      10th July 2025

A total of 783 UK businesses filed for administration in the first six months of 2025 – an 11 per cent decrease from the 879 recorded during the same period in 2024, according to analysis by full-service law firm Shakespeare Martineau.

However, the figure remains 3 per cent higher than in 2023, signalling that UK companies are still facing significant pressures despite some signs of economic stabilisation.

Notably, retail filings surged by 29 per cent, rising from 119 in 2024 to 153 in 2025, making it the hardest-hit sector by a clear margin, according to data from The Gazette Official Public Record. The North West overtook Greater London as the region with the most business failures, with 165 administrations (up 11 per cent from 2024) compared to Greater London’s 158 (a 17 per cent drop).

Andy Taylor, partner and head of restructuring at Shakespeare Martineau, said: “While the year-on-year drop in administrations is worthy of note, the overall picture for business remains challenging.

“With 783 appointments being made, we are still seeing more businesses enter administration than in 2023 and distress remains widespread across multiple sectors and regions.”

Along with retail, hospitality, construction, real estate and manufacturing were the worst-hit sectors, collectively accounting for 60 per cent of all administrations.

Hospitality saw a slight increase (80 vs 78), reflecting ongoing pressure on disposable incomes and discretionary spending. In contrast, manufacturing (77) and construction (79) both saw significant year-on-year declines, down 29 per cent and 26 per cent respectively.

Andy said: “The retail sector remains under significant pressure. Despite a slight easing of inflation and interest rates, consumers remain cautious and price-sensitive. Footfall continues to lag and many businesses have not been able to adapt to the new retail landscape.

“The drop in manufacturing and construction filings could be the result of earlier failures having already removed the weakest operators. It may also reflect a slowdown in activity, with firms putting investment and hiring decisions on hold due to continued uncertainty.”

Geographically, Greater London filings fell 17 per cent (191 to 158), while Yorkshire & The Humber (99 to 63) also saw a sharp decline, down 36 per cent. The South East (92) and West Midlands (56) made up the rest of the top five.

Andy said: “The North West becoming the worst-hit region is a significant shift. This suggests that distress is becoming more geographically widespread, no longer concentrated in Greater London and the South East. Local economic factors – including legacy pandemic debt, delayed investment and supply chain costs – continue to weigh heavily.”

Despite a drop in administration volumes, Andy warned businesses not to be complacent.

He said: “These figures, while worthy of note, do not detract from the fact that the trading environment for many businesses remains highly challenging. Many companies are surviving through short-term fixes, but without sustained growth, improved consumer confidence and better access to funding, there are still choppy waters to navigate.

“Geopolitical uncertainty, post-election policy shifts, energy costs and ongoing global conflicts are still creating an unpredictable environment for business. Firms must remain agile and, above all, proactive.

“Our advice remains unchanged – seek expert help early. The sooner directors act, the more tools are available to protect the business and find a viable path forward.”