This section is from the book "Business Finance", by William Henry Lough. Also available from Amazon: Business Finance, A Practical Study of Financial Management in Private Business Concerns.
The number of business concerns which become insolvent each year averages a little below 1 % of the total number. Following is the record for the last ten years.
No. of Failures
No. of Business Concerns
Percentage of Failures
However, this record does not present a complete picture for it does not include numberless instances of financial embarrassment which are settled out of court. Nor does it include the still larger number of cases where a business concern gradually sinks its capital until finally the enterprise is sold or is transferred on some contractual arrangement, thus bringing the enterprise into the hands of new men who supply fresh capital which is either sunk or makes the business a success. Sometimes the process of passing a business concern from hand to hand, each new owner losing money until he reaches the point where he is glad to hand it over to some one else, is carried on over a remarkably long period.