Deloitte reports a 6% increase in 2012 retail administrations

Retailers were under pressure last year as the number of companies that collapsed into administration rose by 6pc.

According to accountancy firm Deloitte, which was appointed the administrator to Comet, 194 retailers fell into administration last year. This compares to 183 in 2011 and is an 18pc rise on the 165 in 2010.

The retail failures in 2012 included high-profile high street names such as Comet, Clinton Cards, Game and JJB Sports.

Lee Manning, restructuring services partner at Deloitte, said: “These figures are a stark reminder of the difficulties which continue to face the high street.

“Constrained household budgets and the structural challenges facing the sector mean it is certain that we will see further distress next year."

While Christmas trading appeared to have been "reasonable", Mr Manning said it was not spectacular and not enough to prevent insolvencies in the first quarter of 2013.

“There will always be a need for physical retail space but at present, too many retailers have too many stores and 2013 is likely to be marked by further closure programmes, both within and outside of formal insolvency processes," he added.

"Similarly, as an increasing proportion of retail sales move to online and mobile, retailers need to consider how their stores support sales across all channels by offering flexible delivery or collection options, becoming a product showroom and developing brand engagement and loyalty.”

Despite the increase in retail collapses, the total number of businesses that fell into administration in the UK last year fell by 9pc to 2,010.

Source : Telegraph.co.uk
www.telegraph.co.uk/finance/newsbysector/retailandconsumer/9775184/Retail-administrations-jump-6pc-in-2012-Deloitte.html