Half of homewares retailers ‘likely to fail’

Half of all household goods retailers are at risk of failure, according to new research by retail business consultants FSP.

Half of homewares retailers ‘likely to fail’

The company has produced a geographical assessment of 600 multiple retailers in towns and shopping centres, and says that, across the board, 40% of them, with a combined total of almost 13,000 stores, are in the Very Worrying category.

This category includes all companies whose sales, less cost of bought-in goods and services, are less than the cost of staff and depreciation. With basic operating costs not being covered, these retailers are deemed to be in the At Risk category without continuing investment.

All the recent failures of multiple retailers, bar one, had previously been classified as Very Worrying.

The report says that 50% of household goods and 49% of food retailers are At Risk, but only 21% of large stores are in that category. Towns in London, Scotland and Wales have higher than average concentrations of At Risk retailers, while towns in the East Midlands, north east, West Midlands and Yorkshire and Humber have lower than average concentrations of At Risk retailers.

Small towns, particularly minor district centres, tend to have higher than average concentrations of At Risk retailers.

The major towns least At Risk are Chesterfield, Lincoln, Bedford, Wolverhampton and Middlesbrough, while areas most in danger are Croydon, the West End, Bromley, Chelmsford and Blackpool.

Shopping Centres most At Risk include Churchill Square (Brighton), The Glades (Bromley), Frenchgate (Doncaster), County Mall (Crawley) and Golden Square (Warrington). Least threatened include Cwmbran Shopping Centre, Brent Cross, Bull Ring (Birmingham), Whitefriars (Canterbury), and Meadowhall (Sheffield).

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