More businesses said to be at risk

Dun & Bradstreet Israel: Food chains, restaurants, pubs, clothing shops struggle.

April 8, 2010 10:32
2 minute read.
One in three restaurants is in danger of immediate

One in three restaurants is in danger of immediate. (photo credit: Ariel Jerozolimski)

Despite positive signs of growth in the economy in recent months, more businesses were in danger of closing in March, while payment reliability improved during the same month, business research company Dun & Bradstreet Israel reported Wednesday.

“Food chains, restaurants, pubs and clothing shops are leading the list of sectors in the economy with the highest risk of closure and the worst payment ethic,” D&B Israel economists said in their monthly research survey.

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In March, 13.16 percent of businesses in the economy were in danger of shutting their doors, a slight deterioration from the February level of 13.06%, the survey found.

While most sectors in the economy showed deterioration month-to-month, the report said restaurants and pubs remained the worst off, with 28.42% of businesses in danger of closing, compared with 28.26% in February.

The next most risky businesses were food stores, with 27.6% of them in danger of closing down in March, compared with 28.8% in February.

In the clothing industry, 17.7% of businesses were on the verge of closure in March, up from 17.4% in February.

Finance, insurance, and money-management businesses were the strongest sectors in March, with 8.8% of businesses at risk of immediate closure, down from 8.83% in February, the report said.

The communications industry, considered a low-risk industry, saw a rise in the proportion of businesses at risk, at 7.87% in March, from 7.66% in February. The proportion of businesses at risk in the electronics industry increased to 5.29% in March, from 5.18% in February.

The survey showed that the payment reliability of local businesses improved in March, with 22.5% of businesses late with their payments, compared with 25.6% in February and 37.4% in November.

The survey showed that food chains had the worst payment ethic, with 55.6% of businesses in the sector late in making payments, compared with 54.5% in February.

Furthermore, the proportion of food producers with a bad payment ethic rose sharply in March to 11.17% from 6.85% in February.

Hotels and guest houses saw an improvement in March, with 34.78% of businesses late in payment, down from 42.39% in February.

The report said despite signs of a recovery in the local real-estate market, the proportion of contractors and builders in arrears rose to 17% in March from 16.35% in February.

Payment habits in the textiles and clothing industry deteriorated to 12.5% of businesses making late payments in March from 11.76% in February. The proportion of business-services companies in arrears increased to 17.33% from 16.10% in February.

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