Rent Day is a big deal for many households, but in business it can be even more of a challenge, with three months’ worth of premises rent to pay for in one go.
No surprise then that, according to R3 – the Association of Business Recovery Professionals, as many as one in three retailers in the UK are at risk of entering insolvency in the coming 12 months, with Rent Day playing a major part in driving that statistic higher.
R3 president Liz Bingham says: “After dealing with a recession, a sluggish recovery and changing consumer habits, traditional retailers will be put under more pressure as they are exposed to the stresses of expansion as economic recovery picks up.”
In all, 31% of retailers – just less than a third – are currently at risk of entering insolvency during the coming year, compared with only a quarter (25%) of firms across all UK industry areas.
But ask the retailers themselves, and many more have a negative outlook; in July, R3 found that 42% of all retailers were experiencing symptoms of financial distress, compared with 35% across all industries.
It is clear that, whether based on hard data or own opinions, the retail sector is suffering at present, and the rest of the economy is not far behind in terms of uncertainty.
With the latest Rent Day out of the way at the end of September, it is now a crucial time for retailers to make the most of pre-Christmas sales, and ensure revenues are at their greatest as we head into the new year.