23,000 UK retailers are ‘under significant financial stress’
UK-based services consultancy specialists Begbies Traynor has released figures showing that nearly 23,000 UK retailers were under significant financial stress at the end of the first quarter of this year, a rise of 4% compared to Q1 2016.
Rising costs, tax hikes and the continuing squeeze on consumer spending have all played a part, with a number of well known High Street retailers expected to fall into administration this year, according to the report.
John Lewis, Tesco, Sainsbury’s and Boots have already reduced staff numbers in a bid to survive the uncertain retail period ahead.
Historically, the new season would have triggered high street spending. Last year, Easter took place a few days in advance of payday, with UK retail footfall increasing by 1.2% in March year-on-year, breaking a six month decline.
Retail analyst Springboard predicts that the warmer weather forecast this year should see a 5.4% increase to UK retail footfall and 8.8% footfall increase to UK high streets.
However, the increase in footfall is unlikely to create the lift that UK retail needs as shoppers eschew spending on fashion, instead concentrating on day-to-day items such as food and beverages.
Certainly, credit insurance firms already suspicious of retailers who they feel might not make it through this retail period will be making decisions over the coming months that may see a number leading high street businesses enter administration.