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Tuesday, 21 August 2012

Retail Insolvencies - 50% of Jobs Saved

An interesting bit of research from R3, the insolvency trade body, has shown that since 2011 large retail insolvencies have resulted in 50% of the jobs being saved.  I suppose it depends on whether you are a glass half empty or half full sort of person but this is generally better than many people expect.  R3 has been tracking the staffing impacts at major retail collapses such as Blacks, Aquascutum, Clinton Cards and Game Group.


In general, it can be said that the more flexible insolvency regime since 2002 has helped business survive.   The use of CVAs and pre pack administrations have also helped.

R3 said that many retailers have portfolios that are too large and the rents agreed were at the pre 2008 crisis.  This has meant that many companies have had a debt burden that they simply have not been able to maintain.    Woolworths was the most high profile collapse where all stores were shut down.  It should be remembered, of course that there are many smaller retailers that are simply not going to be bought up or have the ability to restructure and landlords need to be more flexible in their approach

The figures are as below.



Major Retail failures 2011/12
Pre-Insolvency
Post-insolvency
Company
Stores
Employees
Stores
Employees
313
3,885
224
2,750
Focus DIY
180
4,000
55
1,000
Habitat
33
750
3
150
Homeform+
160
1,300
50
740
Jane Norman
89
1,600
33
1,200
La Senza
146
2,600
60
1,300
Past Times
47
1,500
Nil
Nil
Peacocks
614
7,500
388
4,320
Oddbins
139
600
43
150
TJ Hughes
57
4,000
15
1,800
Stylo Barratt
191
3,840
90
2,240
Hawkins Bazaar
65
380
8
80
GAME
610
6,000
333
3,896
Alexon*
75
3,000
50
2,700
Clinton Cards
784
8,000
400
4,500
Updated figures
Julian Graves (Deloitte)
189
755
n/a - still trading
n/a
Allders of Croydon (Duff & Phelps)
1
330
n/a - still trading
n/a
Group.


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Many thanks for your comments. If you have a private business problem and you want advice give us a call on 0800 9700 539 or email me at keiths@companyrescue.co.uk. If you are a professional advisor with a troubled client, please suggest they visit www.companyrescue.co.uk or contact me as above.

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