Insolvencies in the UK’s retail sector have skyrocketed nearly 60 per cent over the past year as bad debts pile on the pressure.
According to new research from Creditsafe’s quarterly Watchdog Report, the second quarter of 2018 saw a total of 416 retail insolvencies, compared to just 261 a year earlier.
The increasing number of casualties were down to a staggering 2464.5 per cent increase in bad debt owed to the retail sector over the last quarter, rising from just £2.1 million to £53.6 million.
“2018 is proving to be an extremely difficult year for the UK high street, with many well-known chains unable to cope with increasing numbers of consumers visiting larger stores and turning to online shopping,” Creditsafe chief executive Chris Robertson said.
“The growing number of job losses and empty shops right across Britain is a big cause for concern.
Despite the rising number of insolvencies, there was also a 40.3 per cent increase in new companies created to 11,475 during the same period, while supermarkets like Asda, Iceland and Ocado were the saw the fastest growth in their store estates.
“Nevertheless, it’s promising to see the resilience of entrepreneurs in deciding to open up new businesses in the face of uncertain and changing market conditions,” Robertson said.
“It’s this positive attitude that will be needed to see the retail sector through this tough period.”