Growing debt and falling sales are placing hundreds of brokers in danger of failing, new research has found.
Financial analyst Plimsoll looked at the financial results of 2,000 brokers trading as limited companies.
It found that 496 brokers displayed symptoms of company failure.
Plimsoll senior analyst Christopher Evans, who authored the report, said those brokers were showing a "deteriorating" financial performance.
"Many of these companies are at a stage where their debts are severely restricting the ability of the management to make even normal business decisions," he said.
At the other end of the scale 754 brokers were termed as being "strong".
Evans said: "Some of these companies will be on the lookout for acquisitions in the near future."
Of those 754 brokers, 391 were attacking the market share of other companies in the industry. "These companies grew by 25% in 2004 against the average industry growth of 5.8%," he said. "Their appetite for market share appears insatiable."
The report claimed that pressure on those smaller brokers surviving on tight margins will intensify as acquiring brokers "rampage across the market".
