A raft of the sector’s biggest names have joined the unprecedented consortium of top retailers demanding the right to pay rent monthly.
The campaign is understood to have attracted the support of additional retailers this week, including B&Q, Matalan and those owned by Sir Tom Hunter’s West Coast Capital, which include Wyevale and Office. They join Sir Philip Green’s Arcadia, Next, Carphone Warehouse, Boots and DSGi who were among the initial 16 rebels revealed at the weekend.
The group plans to appoint a representative over the summer who will approach big landlords to demand a switch from the archaic system of quarterly in advance to monthly payments.
The retailers’ exact strategy is still being finalised, but the aim is to resolve the issue before the next quarterly rent date in September.
According to the British Retail Consortium, the payment of rents quarterly in advance costs retailers£145 million a year.
One retail leader in the new group said there was no justification for landlords to continue demanding quarterly payments in advance, particularly at a time when cash flow is such a crucial issue for retailers.
The source said: “They’re the only people in the world who get paid in advance. Suppliers are all getting squeezed on payment terms, but landlords are suppliers too – what’s the difference between supplying garments and supplying property?”
The source added that the campaign has attracted most of the UK’s major non-food retailers and that even department stores – which generally only pay peppercorn rents – such as House of Fraser had expressed an interest.
The initiative comes against a backdrop of appalling trading conditions that have hit retailers hard.
It is understood that if the monthly rent campaign is successful, some members might continue to up the pressure on landlords by tackling other issues, including rent reviews in shopping centres.
The BRC began a campaign to secure monthly rents for members in 2006 but although some landlords acceded, these were generally local authorities and not big commercial landlords.