Retail administrations on the up | News | EN for Business

Retail administrations have increased 15 per cent year-on-year, new figures have revealed.

According to business advisory firm Deloitte, there were 69 in the first quarter of this year compared to 60 in the same period last year.

The number of retailers going under in Q1 compared with Q4 2011, rose by 64 per cent when just 42 were declared insolvent.

Bill Dawson, a partner in reorganisation services at Deloitte in the North West, said that the quarterly rent day often leads to a rise in the number of retailers going bust, but the recent spate is because many companies have too many marginal stores.

?As online retailing continues to grow whilst overall spending is weak, the fixed costs and poor performance of some stores drags on the overall business.

?The first quarter of 2012 is particularly significant given the high profile nature of the companies we have seen enter administration: Peacocks, Game, La Senza, Blacks and Past Times,? he added.

Dawson explained that the number of job losses as a result of these administrations reached just under 10,000 out of the 22,000 employed by the firms.

He concluded, ?In contrast, Q1 2011 saw far lower levels of job losses. Overall, for 2011 and the first quarter of 2012 the largest 15 retail insolvencies had 2,800 stores and only 1,350 stores have survived; an attrition rate of 52 per cent.?

Deloitte recently published its Store of the Future report, which suggested that some retailers may have to reduce their property portfolios by up to 40 per cent in the next five years in order to adapt to the changing needs of consumers.

By Kirsty Hewitt

Permalink

dobie gray bruce springsteen grammy nominations lil boosie bobbi kristina brown new edition austerity