BREXIT and rising inflation are blamed for a rise in the number of firms across Oxford in financial distress during the first three months of this year.
Business recovery firm Begbies Traynor’s Red Flag Alert research showed 776 businesses in Oxford reported ‘significant’ financial distress during the period.
Compared to 716 in the final three months of last year, it represents a rise of eight per cent.
Julie Palmer, regional managing partner at Begbies Traynor in Oxford, warned firms would pass it on in as price rises.
She said: “Given the scale of the increases in distress during the first quarter of this year, it would appear that food suppliers, logistics firms and wholesalers are yet to fully pass on rising costs to their customers.
“It is only a matter of time before we start to see this coming through, especially given added margin pressures associated with the new National Living Wage.”
She added: “Once those costs ultimately feed through to consumers, we’d expect further pressure on sectors exposed to discretionary spending such as retail, bars and restaurants, travel and leisure.”
Worst hit sectors in Oxford were food and drug retailers, followed by those in the media and construction.
Begbies Traynor executive chairman Ric Traynor said more firms were in trouble due to the falling pound and worries about leaving the EU, particularly when it comes to migrant workers.
He pointed out: “These figures show that rising energy and food prices, combined with the devaluation of Sterling, have undoubtedly put a strain on much of the UK’s supply chain.”