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Buying a business

Buying a business in 2026: what falling insolvencies mean for your timing

UK business insolvencies fell 19% in August. If you have been waiting for a weaker market to hand you a cheaper deal, the numbers have just moved the other way.

Reading time 6 min read
Category Business guides
Written by The bizbritain team
For the first time in months, the UK insolvency numbers have moved the right way. According to Creditsafe, 2,074 businesses failed in August, which is 19% fewer than in July. If you have been waiting for a weaker economy to hand you a cheaper business to buy, that number changes the picture.

Section 01

What the August numbers actually say

According to Creditsafe, 2,074 businesses across the UK and Northern Ireland entered insolvency in August 2026.
That is a 19% fall on July. It is also down 10% on August 2025.
The sector split tells you where the pressure still sits.
2,074businesses entered insolvency in August 2026
19%fewer than in July 2026
350construction failures, the largest sector share at 17%
261accommodation and food services failures
Construction had 350 failures in August. That is 17% of every UK business insolvency in the month, and the largest share of any sector.
Wholesale and retail followed with 290. Accommodation and food services had 261. Between them, those two sectors made up 27% of all failures.
So the picture is mixed. Fewer businesses are failing, and the same three sectors are still carrying most of the pain.

Section 02

Why waiting for a cheaper deal is now a risk

Plenty of would-be buyers have spent 2026 waiting.
The logic is easy to follow. A weak economy pushes more businesses into trouble. More owners sell, and prices soften.
August is the first month in a while where that logic points the other way.
One month is not a trend. Insolvencies are still running high by historic standards, and Creditsafe describes August as an improvement rather than a recovery.
So, should you rush into something?
No. But it is worth dropping “wait for it to get worse” as a plan. That is a bet on the economy, not a bet on a business.

Section 03

Most businesses that change hands are not distressed

This is the part first-time buyers most often get wrong.
An insolvency is not a business arriving on the market. Most insolvent companies are closed down rather than sold on. The customers, staff and contracts go with them.
What is left is often equipment and a lease.
Myth 01

“The best deals come from businesses that have failed”

Buying out of an insolvency can work, and it is fast. It is also the version of a deal with the least information, the least help from the seller and the shortest deadline.

A profitable business sold by an owner who wants to retire is usually the better buy. There are also far more of them.

Look for a seller with a reason, not a business with a problem.

The wider market for business sales is quieter and much larger. Owners retire. Partners go separate ways. People decide they have had enough.
None of those sales are driven by the insolvency figures at all.

Section 04

What to have ready before you make an offer

Whatever the market does next, the buyers who complete are the ones who can move when something good appears.
Four things do most of that work.

  1. Know your number

    Work out what you can realistically fund before you start looking. A price range you have tested is worth more than a wish list.

  2. Get your own paperwork together

    A lender will want to see your own financial position as well as the accounts of the business you are buying. Having it ready can take weeks out of the process.

  3. Understand how the deal will be structured

    Very few acquisitions are funded by a single loan. A combination of a business loan, asset finance and money left in the deal by the seller is more common.

  4. Talk to a broker before you offer, not after

    A broker can look at the deal across a wider range of lenders than you can approach on your own. Knowing what is fundable shapes what you offer.

bizbritain is a broker. We help first-time buyers work out what a deal can be funded to, then take it to the lenders whose criteria it fits.

This guide is general information, not financial advice. Applications are subject to status, affordability and lender criteria.

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