The number of retailers facing “critical” financial troubles has increased 91 per cent in the second quarter of this year compared to 2008.

The growth in the number of retailers with financial woes has however decreased to just 10 per cent quarter on quarter, according to a report by Begbies Traynor.

The recovery and restructuring specialist released the findings from its Red Flag Alert report today which also showed that since last year retailers in “significant” financial distress had grown, up 74 per cent compared to the same period last year.

Begbies Traynor partner Nick Hood said: “Although problems in the retail sector have slowed quarter on quarter at both Critical and Significant levels, prospects remain tough for the sector. Year on year we have seen massive increases in financial problems and retailers are facing continued pressures from the weakness of the sterling which is forcing up costs inexorably at the worst possible time.”