The number of business failures lifted sharply during the September quarter according to the latest New and Failed Businesses report from Dun & Bradstreet.
The report reveals business failures jumped by 42% compared to the previous quarter, to be up by 11% compared to one year ago.
There were 15,116 business failures during the September quarter – up from 10,642 in Q2, and 13,615 in Q3 2015 – which is the highest figure since Q1 2013.
Dun & Bradstreet highlights the September quarter result is in stark contrast to the 18.3% decline in business failures in the second quarter.
“Business failures nationally were up significantly between Q2 and Q3, with the ACT, Western Australia and the Northern Territory recording increases well above 50%,” the report notes.
“The number of failed business was the highest for a single quarter since Q1 2013 for all states and territories, with the exception of Tasmania.”
In addition, the number of businesses start-ups fell by 13.7%, following the three-year high in new businesses created in the second quarter.
There were 62,073 new business created during the quarter, compared to 71,963 the previous quarter.
“The results indicate business conditions for start-ups may not be as favourable as the confident outlook reported by established businesses in Dun & Bradstreet’s latest Business Expectations Survey,” the report says.
The number of new start-ups was highest in New South Wales, which recorded 24,183 new businesses in the September quarter (down 6.6%), followed by Victoria, however the report notes start-ups have declined on both annual and quarter-to-quarter bases in the state.
“While all states and territories reported fewer start-ups compared to Q2 2016, South Australia and the Northern Territory experienced notable increases of 16.3% and 14.2%, respectively, compared to Q3 2015,” the report adds.
A state-by-state snapshot for the September quarter compared to the previous quarter is as follows:
- ACT: Business failures jumped by 83% over the quarter to a three-year high of 228. New business start-ups declined by 3.6% to 1009.
- New South Wales: Business failures increased by 43.2% to 5271 – the third consecutive quarterly increase. The number of new businesses fell by 6.6% to 22,587.
- Northern Territory: Business failures lifted by 54.2% to 91, while the number of new businesses dropped by 13.3% to 241.
- Queensland: Business failures increased by 43.1%, while new businesses decreased by 13.2%.
- South Australia: business failures were up 36.6% to 538, with the state recording the largest decline in new business start-ups, which were down by 20.7%.
- Tasmania: business failures were up by 21%, while start-ups were down by 9.1%.
- Victoria: business failures increased by 46.8% to 3,881 and business start-ups declined by 15.7%.
- Western Australia: business failures soared 59% from 879 to 1398 – the highest result in three years – while new business start-ups dropped 13.6% compared to the June quarter.