Retailers are being urged to write new terms into their leases for monthly rather than quarterly rent payments, as independents approach the most difficult rent day of the year.
The March 25 quarter day is the toughest one of the year, according to the British Retail Consortium, when pressure on retailers' cash flow is at its greatest after the post-Christmas lull. A move to monthly payments would improve budgeting and ease cash flow.
A BRC spokesman said retailers needed to be more proactive. "We are advising retailers before they sign a lease that if it sets out quarterly terms, they should physically change it themselves," he said.
He added that the BRC, which first launched its campaign last May, believed the majority of retail leases can be based on monthly terms. "We have made rapid progress compared with a year ago," he said. "Some retailers have managed to renegotiate up to 20% off their existing leases."
The BRC also plans to survey major retailers to see how far the situation has changed over that period.
Independent retailers have supported the idea. Frank Raven, manager of menswear indie Glanville in Harlow, Essex, which is set to close after high rents made its flagship store unprofitable, said it had paid its rent on a quarterly basis. "We always budgeted for it, but paying monthly would help smaller businesses. We have moved to paying our telephone bill monthly, and that helps."
Despite the BRC's campaign, most retailers still pay rent quarterly. However, Tricia Friar, owner of kidswear independent Munchkins in Northwich, Cheshire, pays her rent on a weekly basis. "It is brilliant, but extremely rare," she said. "My landlord has been trying to switch to monthly, but weekly is much better for cash flow. You can work your finances weekly rather than struggling through a difficult spot at the end of each quarter or each month."
Nevertheless, some landlords say that quarterly rents have not been raised as a problem by their tenants. Grosvenor head of leasing Neil Barber said: "I am involved in developments in Liverpool and Cambridge and I haven't been asked about it" He added that many retailers have a rent-free period at the start of their lease, so it could be argued that they are paying quarterly in arrears.