Up to 45,000 retailers across the UK ended the first quarter of 2018 in a state of ‘significant’ distress, according to research by Begbies Traynor.
The challenging conditions of Q1 2018 saw the number of distressed retailers rise by 21% compared to the same period in 2017.
The number of distressed fashion retailers rose 19% year-on-year to 6,198, from 5181 in 2017.
The rise in distress levels coincides in the sharpest drop in footfall since 2012, with a 8.6% drop recorded in March alone compared to the previous year.
Julie Palmer, partner and retail expert at Begbies Traynor, said: ”The UK high street has been having a torrid time of late, with the Beast from the East, growing competition from online rivals, higher staff costs, rising business rates and declining consumer spending, pushing many retailers to the point of no return.
“With competition on the high street fiercer than ever and sales volumes expected to be flat at best this year, those retailers with sophisticated delivery options and a strong multi-channel offering are likely to come out on top. At the same time, any businesses who are still playing catch-up on the technology front, or have failed to grow their customer base or invest in modernising legacy systems, are only going to lag further behind the pack.
“However, there is a glimmer of hope on the horizon for the UK’s consumer-facing industries who have weathered the storm thus far.
”With inflation falling back, lower unemployment and real wage growth finally returning, we should hopefully see households start spending again as the weather improves.”