How to Avoid Partnering with Risky Businesses in the UK

Doing business always involves some degree of trust. Whether you are supplying goods on credit, entering a joint venture, or outsourcing a service, you rely on the other party to deliver on their commitments. In the UK’s current economic climate, where corporate insolvencies remain at historic highs, that trust has never been more important. Partnering with the risky business can quickly lead to unpaid invoices, disrupted operations, and even financial instability for your own company. For directors, the challenge is clear: how do you avoid risky business relationships without losing opportunities? This article explores the warning signs, due diligence strategies, and practical steps directors can take to protect themselves. It also highlights how the right professional advice, including from insolvency experts like Simple Liquidation, can safeguard your company from unnecessary exposure.


UK company insolvencies have been climbing steadily in recent years. In July 2025 alone, more than 2,000 companies entered insolvency. Creditors’ Voluntary Liquidations (CVLs) made up the majority of cases, alongside a rise in compulsory liquidations and administrations.

For business owners, this environment creates a domino effect. If a supplier, customer, or partner collapses, the impact can cascade down the supply chain. You may face unpaid debts, delayed projects, or the need to find replacements at short notice. Even large firms, once considered safe, are vulnerable. High-profile collapses in steel, retail, and construction show how quickly fortunes can change.

Simple Liquidation was designed to provide directors with a quick and straightforward solution to liquidate a company. However, our expertise extends beyond liquidation. With over 30 years of combined experience, our licensed insolvency practitioners, Jamie Playford (FABRP MIPA) and Alex Dunton (MABRP), have dealt with hundreds of solvent and insolvent businesses.

This experience means we understand how businesses fail, what warning signs to look for, and how to guide directors who may be exposed to risky partners. We are not intermediaries or salespeople. We are licensed professionals, authorised by the Insolvency Practitioners Association and the Institute of Chartered Accountants in England and Wales, and members of the Association of Business Recovery Professionals (R3).

If you are concerned about the stability of a partner, customer, or supplier, we can help you interpret the risk and decide on a sensible course of action.

Avoid Partnering with Risky Businesses in the UK

Location: United Kingdom

Comments

Post a Comment

Popular posts from this blog

Role of Government in Shaping Insolvency Outcomes in the UK

Image
Insolvency is a critical aspect of any robust economic system, providing mechanisms for businesses to either restructure or close down while ensuring fair treatment for creditors and other stakeholders. In the United Kingdom, the government plays a pivotal role in shaping insolvency outcomes by designing legislation, providing oversight, and facilitating mechanisms to resolve financial distress. At Simple Liquidation, we understand the importance of government involvement in ensuring that insolvency processes remain transparent, fair, and effective. As one of the UK’s most appointed insolvency practices, we are committed to helping businesses navigate financial challenges in alignment with established regulations. Government’s Role in Insolvency Framework The UK government’s involvement in insolvency is multifaceted, encompassing regulatory, legislative, and policy-making responsibilities. Key areas of influence include: 1. Legislative Framework The foundation of insolvency proceeding...
Read more

How Does the Liquidation of 77-Year-Old Clarkebond Reflect the Changing Industry Landscape?

Image
The sudden liquidation of Clarkebond (UK) Ltd in December, just three months after its acquisition by Independent Design House Group (IDHG), has shocked many in the engineering sector. A firm with a proud 77-year legacy, its abrupt collapse raises important questions about the changing dynamics in the industry, particularly concerning mergers and acquisitions, management practices, and the impact of new ownership on established businesses. In this blog, we explore how the Clarkebond liquidation highlights broader trends in the engineering and consultancy industry and what it means for companies navigating an increasingly complex business environment. Clarkebond was once a leading engineering consultancy, trusted by clients for nearly eight decades. However, the acquisition by IDHG, a specialist in temporary works, marked a significant shift. IDHG’s leadership saw the acquisition as an opportunity to expand its footprint, increase its workforce, and diversify its services. They were opt...
Read more

Types of Bankruptcies in the United Kingdom

Image
Bankruptcy and insolvency can be daunting concepts, but understanding the different forms they take in the United Kingdom is essential for anyone facing financial challenges—whether as an individual or a business owner. UK insolvency law is designed to help manage unpayable debts and protect the interests of both debtors and creditors. While the term “bankruptcy” is often used colloquially to refer to any financial collapse, it specifically applies to individuals, while companies face liquidation, administration, or voluntary arrangements. This blog provides a comprehensive look at the main types of bankruptcies and insolvency procedures in the UK, including who they apply to, how they work, and what their consequences are. We’ll also highlight why expert guidance from professionals like Simple Liquidation is invaluable during these critical moments. Personal Bankruptcy Bankruptcy in the UK is a legal process available to individuals who are unable to repay their debts. It is typicall...
Read more