More shop closures on the way?

Sam Talby
Sam Talby

South west shoppers are warned to expect another wave of shop-closures, around Christmas and the New Year.

Despite recent reports that some retailers are seeing slight signs of recovery, more shops will go to the wall at the height of the Christmas and New Year retail season, according to an insolvency specialist at south west accountancy firm, Bishop Fleming.

Sam Talby, an insolvency and restructuring partner at Bishop Fleming, said: “The South West is facing three of the classical killers for retailers: Sales and discount-offers are already a fixed-feature – way ahead of Christmas and the traditional January sales; unemployment is on the rise – and will continue to increase for many months; and shoppers no longer have easy-access to credit.”

Behind the scenes, he says, there are frantic negotiations between retailers and their landlords – trying to stave off the impact of their rent-demand on Christmas Day.

Most at threat are some of the country’s biggest multiple-retailers, dependent upon the housing market – like furniture and carpeting stores – and the shops in ‘secondary retail areas’.

“The South West’s big new shopping centres have hit the more traditional secondary retail areas,” said Talby.

But the retailers in those big shopping centres are also at risk.

Talby added: “It is likely that some big-name occupiers of those new centres are seeing a fraction of the sales now being achieved by the low-cost retailers, like Primark.

“I suspect that if some of those high-end anchor stores in new shopping centres had to pay rent, they would shut overnight!”

“But this is all good news for consumers,” said Talby. “In the lead-up to Christmas, retailers will be eager to shift stock – forcing them to adopt discounting policies and accept shopper’s offers,” he added.