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Supply chain insolvencies could rival inflation as a threat to project delivery, according to Turner & Townsend.

Insolvencies rose 72.1% year-on-year in the second quarter of 2022 with SMEs at the greatest risk of failure, according to the consultancy鈥檚 latest UK Market Intelligence Report.

Martin Sudweeks, T&T鈥檚 managing director for cost management in the UK, said businesses need to be 鈥渕ore alert鈥� to the risk in their supply chains.

鈥淚t鈥檚 essential to spot the tell-tale signs of insolvency risk early 鈥� those include low productivity, difficulty securing labour or materials, and failure to pay suppliers,鈥� he said.

鈥淭o be prepared, build trust and open communication within your supply chain.鈥�

Accountancy firm Price Bailey warned in June that an increase in firms in the sector defaulting on covid loan repayments could indicate a wave of companies going under this summer.

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The temporary easing of insolvency rules in the wake of the pandemic were brought to an end in March this year, resulting in a large number of second quarter collapses.

The market report also saw T&T revise its tender price inflation forecasts for 2022 up to 8.7% from the 8.5% estimated in the spring.

Across the infrastructure sector the situation is more pressured, with estimates for 2022 up to 8% compared with the 6% forecast in T&T鈥檚 spring report.