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5,500 fashion retailers at risk of insolvency

More than 5,500 clothing retailers are estimated to be at risk of becoming insolvent, as business rates and Brexit negotiations continue to add pressure on the industry.

Around 18% (5,538) of all clothing retailers are showing warning signs, according to accountancy firm Moore Stephens, which analysed 30,940 businesses.

The accountancy firm attributed this to the recent rise in business rates and the introduction of the national living wage.

Other factors included increasing competition from online rivals and the weakened pound.

Moore Stephens head of restructuring and insolvency Jeremy Willmont said: “Clothing retailers are being buffeted hard on many fronts. Rising costs and intensifying competition are putting pressure on revenue and making profit margins harder to maintain.

“Sterling’s post-Brexit performance could have a chilling effect on discretionary spending on ‘fast fashion’ imported from overseas supply chains.’’

Readers' comments (1)

  • darren hoggett

    Why is the obvious reason of why some businesses are run badly never discussed? They should factor in all the variables of the wider economy and act accordingly instead of using the excuse of outside forces.

    BREXIT and Business Rates aren't credible reasons why businesses fail - it's the people who run them.

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