The number of retailers going into administration fell in the second quarter and first half of this year, despite tough trading.
According to research by business adviser Deloitte, there was a 16 per cent decline in administrations in the second quarter, compared with quarter one. During the first half, there was a 30 per cent fall.
Clothing and cosmetics retailers suffered a 21.2 per cent rise in administrations in the first half. However, other sectors such as books and music – which had a high casualty rate last year – were hit by fewer collapses. That trend partly explained what Deloitte described as “counter-cyclical” numbers.
Deloitte reorganisation services partner Lee Manning said: “It is important to note that the administration figures are generally skewed towards smaller businesses, as larger business are better suited to being restructured because of their greater scale and financing models.
“If, as we are now seeing, the larger retailers are starting to feel the pinch, their smaller counterparts will also be suffering and may struggle to survive if the present economic environment persists.
“In particular, we would expect furniture and household-related retailers to experience an increase in failures [in the] next quarter.”
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