A new league table from leading financial analysts Plimsoll Publishing aims to provide an answer to that age-old question in the packaging market: Why do some companies fail and others prosper?
In the UK, one in five packaging companies are currently at risk of failure, while one in four are doing well.
A league table based on 800 leading firms looks like this:
• 210 companies are 'strong' with a pre-tax margin of 7%
• 76 are in the 'good' sector, on 3% margins
• 145 are rated as 'mediocre', on 3%
• 194 are in the 'caution' category, with minus 1% margins
• An alarming 175 are in the 'danger' range, on minus 2%
Nearly nine out of ten UK companies currently in receivership were rated in the lowest two categories by Plimsoll in the two years before their demise.
Its senior analyst David Pattison says:
"169 of the 210 companies in the strong section are there for the second year running, proving that if you have a solid business where management is in control, you can maintain success irrespective of market conditions. The most successful firms are also largely free of debt."
Source: packaging-technology
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