2017 saw 118 retailers going into administration, a 28 per cent increase on the 92 that filed for insolvency in the previous year.
Recent analysis shows that the number of retailers entering administration rose in 2017 for the first time in five years.
Furniture businesses Feather & Black and Multiyork both collapsed at the end of November, taking the number of retailers entering administration to 118 in 2017, a 28 per cent increase on 2016. 26 per cent of the insolvencies occurred in London, followed by the North West (22 per cent) and the South East (20 per cent).
The research also shows that administrations with companies with more than ten stores rose by 55 per cent from 11 in 2016 to 17 in 2017.
A spokesperson for the report comments: “We see insolvencies in higher value categories, such as furniture, as a leading indicator that falling consumer confidence, and a fall in consumer spending, is starting to bite.”
“This has implications for retail sub-sectors with a lower price point which typically take longer to feel the impact of reduced consumer spending.”
He went on to add that pressures on the sector are set to continue into 2018, with the more successful businesses being the ones which have “already proactively addressed the cost challenges alongside focused pricing and sourcing strategies to maximise margins”.
“We also expect online retailers to continue to thrive, driven by two factors, their clear cost advantage against traditional physical retailers and the continued use of sophisticated data analytics to target consumers directly.”
In order to survive and thrive, business owners need accurate, reliable and timely financial information, whether that be profit or cash focused, or both, to accurately and effectively manage the company’s finances and drive growth.
At Beavis Morgan, our SME retail business experts can help you identify your requirements and then design and implement a system that will provide all the information you need, within a cost effective and efficient framework.
Being able to understand and evaluate your business through real-time information on actual performance is critical and could mean the difference between survival and business failure.
Through our partner businesses, BM Structured Finance and BM Advisory, we are able to help with sourcing and restructuring debt finance for SME businesses, as well as assisting with resolving issues which can impact on business performance and success, and finding innovative solutions for businesses and individuals in distress.
To find out more about how we can assist you and your SME business, contact Steve Govey or your usual Beavis Morgan Partner.