Difficult trading conditions look set to continue

At the Business Sale Report we've seen an increase in the number of business administrations in recent years as the difficult economic conditions that have continued after the recession refuse to lift.

It appears that the Bank of England doesn't hold out much hope for change any time soon, as the Bank's governor, Mervyn King, has said that he doesn't expect inflation to return to target until the second half of next year, while the annual growth forecast has been cut from one per cent to 0.8 per cent.

Chris Williamson, chief economist at financial data company Markit, told AP that the Bank's long term view may still be "too optimistic". The financial institution had predicted growth of 2.7 per cent next year, compared to the three per cent it forecast in the February report.

Mr King remarked that the bigger picture is "of a gradual recovery in output, and of subdued domestic cost pressures meaning that inflation is likely to fall back as external influences fade".

The recovery is being hampered by global problems, such as the troubles facing the eurozone at the moment as Greece struggles to settle on an accepted plan of recovery. While these issues continue, the wider view of the UK economy will remain uncertain, potentially hampering investment.

This results in a number of businesses faltering, especially those that require state investment or are operating with small margins. We reported this week, for example, on the administration of the Warehouse Theatre in Croydon, which fell victim to the art sector funding cuts from central government.

Such closures mark a poignant turnaround in a company's fortunes, but for the right investor, they can provide an exciting new future project that, with the right business acumen and support, can be transformed into a new model of success.

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