HUNDREDS of Herefordshire businesses are in danger of collapsing, according to financial experts Begbies Traynor.

The business recovery, financial advisory and property services consultancy says Hereford has seen a 28 per cent year-on-year increase of businesses in distress, with 383 Hereford businesses now in "significant" distress.

Construction and support services businesses are most affected, Begbies Traynor's 'red flag alert', which monitors the financial health of UK companies, said.

More than 550,000 businesses nationally have reported significant financial distress during the first quarter of 2024.

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Begbies Traynor said historic data indicates that a large percentage of the businesses currently in ‘significant’ financial distress are likely to progress towards ‘critical’ financial distress and potential insolvency if the economic backdrop does not improve.

Julie Palmer, partner at Begbies Traynor in Hereford, said macroeconomic conditions that made 2023 difficult continue "to exert unrelenting pressure on corporate balance sheets".

“As a result, this latest data shows a marked increase in firms moving towards insolvency compared to the same period last year.

“Unfortunately, there’s no quick fix for our economy, and with inflation falling slower than expected, hope of a significant fall in interest rates in the near future seems to be fading," she said.

But, despite the pressures, some Hereford businesses have spoken out about their optimism for the future.

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One of those is Wye Valley Group, which has invested a whopping £1.5 million in new equipment as it seeks to ride out the waves of an economic tempest.

The Rotherwas-based family-run business, which includes Wye Valley Demolition, Wye Valley Metals, Wye Valley Skips, Hereford Quarries, Auto-Breakers, Warehouse 701, Merchant 701, Hereford Self-Storage, and Recycling Metals & Waste, employs over 150 people from their offices at the Eastside Recycling Facility.

Co-owner Andrew Howell said that while economic conditions over the past year "have proven challenging for everyone", recent investment will prove critical to future-proofing the group’s financial future.

And new eateries, shops and businesses are continuing to open their doors in the city, with the latest newcomers including Dylan's Den, which already has three shops in Wales, and will open in Hereford in May, Fresco Lounge in the former Bowling Green pub, a chimney cake stall in the Butter Market, and Waffle Shack, a street food business serving up waffles with tasty toppings.