There are still many, but fewer and fewer new sole proprietors
30 percent fewer sole proprietors than usual and the value of starting a company at a multi-year low in July 2022. The summer and the tax changes depressed the spirit of entrepreneurship.
In many ways, the July 2022 company information indicators have become very unusual. A kind of seasonal effect is also typical of the summer months, but interestingly, company foundings are still at a high level in July, but by August they typically reach their lowest point every year. This year, however, the drop in company start-ups arrived earlier, which is more due to economic expectations than to the effect of the summer.
Gloomy market mood
According to Opten’s database, 2,031 company foundings were published in July 2022, which is the lowest value of the last 2 years, and in the years before that, only the first wave of the coronavirus and the cucumber season in August could bring company foundings lower than this. This year, the company founding value in July is particularly noteworthy, since with the tightening of the KATA regulation, there was in principle a chance that more individual businesses would be diverted in the direction of joint ventures. However, this effect is yet to be seen. All in all, the decline in company foundings in July clearly has economic reasons, the fear of recession, high inflation and loan interest rates are not favorable for businesses, especially those entering new markets.
This market sentiment is also confirmed by another important set of data, the trend in the number of settlements. Liquidations are the type of liquidation procedures for partnerships, when the enterprise voluntarily initiates the liquidation of the enterprise. In an average month, 7-800 liquidation proceedings are usually initiated in Hungary, but in July 1,261 liquidation procedures were initiated. Such high values usually only occur in January, when many businesses close their operations permanently at the end of the calendar year. To have so many settlements published in the middle of the summer is quite unprecedented. At the same time, the liquidation value already partly includes the effect of the KATA tightening, as many limited partnerships fall under the scope of the law, some of which have deemed that they cannot continue their operations
Related news
One-fifth of Hungarians aren’t careful enough when shopping online
Nearly three quarters of Hungarians regularly shop and pay online…
Read more >MPL decree won’t disrupt the delivery market
From 28 March 2024 online shops are obliged to also…
Read more >Demand for sustainable cosmetics is little in Germany
When it comes to the sustainability of cosmetic products, German…
Read more >Related news
Large companies are resistant to economic uncertainty
Restrained expectations characterize the domestic corporate sector for the next…
Read more >Company trend in 2024: a more positive half-year, but still a negative message
The lowest number of companies in the last five years…
Read more >The Hungarian Marketing Association for the supply of the profession
The Hungarian Marketing Association is actively working for the future…
Read more >