RETAIL administrations are continuing to rise in the North West and across the UK, a new report says.The study by accountancy firm Deloitte reveals the number of retailers falling into administration in the first quarter of this year increased by 15% to 69 compared with 60 in the same period last year.Retail administrations in Q1 2012 increased by 64% on the previous quarter, when 42 retailers entered administration.Bill Dawson, a partner in reorganisation services at Deloitte in the North West, said: “While the quarterly rent day often sets the timing for the insolvency, a significant trigger in a number of recent administrations is that many retailers have too many marginal stores.“As online retailing continues to grow while 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. “The number of job losses that came as a result of these administrations was almost 10,000 out of the 22,000 employed by those companies.“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%.”The evolving landscape of the retail sector was highlighted in Deloitte’s recent Store of the Future report, which described how retailers need to redefine their store proposition and address changing customer needs.The report suggests that some retailers may have to reduce their property portfolios by up to 40% in the next five years and adapt to meet the changing demands of consumers.Read
