Retail company insolvency rate continues into 2015

Published on April 17, 2015 by Crawfords Accounting

The Centre for Retail Research has published quarterly figures for retail company insolvency rates in the first three months of 2015, and they appear to show a continuation of the situation in 2014 as a whole.

Last year, 43 companies failed in the retail sector, equivalent to roughly 11 in each quarter of the year – and this matches the 11 retail company insolvencies recorded in January-March 2015.

The number of stores affected is slightly higher, at 406, compared with a full-year total of 1,314 in 2014 (an average of 328.5 per quarter).

And the number of employees affected is also up, at 4,030, roughly a third of last year’s 12-month total of 12,335.

However, it’s worth noting that 2014 had the lowest retail company insolvency total since 2011, and the fewest individual stores and employees affected since 2010.

There is also typically a heightened risk of company insolvency in the retail sector in the first quarter, as firms who had pinned their hopes on a Christmas boost in profits don’t always see this materialise.

As such, the 12-month rate for 2015 could prove to be a little lower, continuing the trend of steady improvement for a third year.

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