Retail administrations fall for fourth year in a row, but rise in larger insolvencies reveals cause for concern has been saved
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Retail administrations fall for fourth year in a row, but rise in larger insolvencies reveals cause for concern
10 January 2017
- 92 retailers went into administration during 2016, down 4% from 2015;
- However, for the first time in four years there has been an increase in the number of large retailers (>10 stores) that have gone into administration;
- Total administrations across all industry sectors fell 3% in 2016.
The number of retailers entering administration fell from 96 in 2015 to 92 in 2016, a decrease of 4%, according to Deloitte, the business advisory firm. However, for the first time in four years there has been an uptick in the number of large multi-site retail administration appointments, rising from seven in 2015 to 11 in 2016.
Across all industry sectors, the total number of administrations in England and Wales fell from 1,147 companies in 2015 to 1,110 last year, down 3%. Four industry sectors reported an increase in administrations, with the greatest increase being Mining, Energy & Agriculture with a 22% increase, followed by Financial Services with a 16% increase in administrations.
Dan Butters, restructuring services partner at Deloitte, said: “Retailers have largely benefited from relatively robust consumer confidence over the last 12 months. Only seven of the 92 retail insolvencies in 2016 had a footprint of more than 20 stores.
“However, consumer confidence may be challenged in 2017 by the impact of price inflation in the year ahead. In addition, retailers are likely to be faced with additional cost pressures due to a weaker sterling, impact of the National Living Wage and, critically, business rate increases.
“Successful retailers in 2017 are likely to be those that can differentiate their customer experience, be innovative in their pricing and sourcing strategies and continue to develop technology to better serve customer needs.”
Regionally, more than a quarter of total administrations were based in London (313 appointments), with appointments increasing by 4% relative to 2015. The North West remained the second-largest contributor to administration appointments in 2016 (220 appointments), despite seeing the greatest reduction in appointments year-on-year (down 16%). Of the 92 retail administrations in 2016, 38% took place in London (35), with 17% in the South East (16) and 16% in the North West (15).
End
Notes to editors
England Administration Appointments by Sector & Region
Breakdown by sector
Q1 2016 |
Q2 2016 |
Q3 2016 |
Q4 2016 |
Total |
Q1 2015 |
Q2 2015 |
Q3 2015 |
Q4 2015 |
Total |
|
---|---|---|---|---|---|---|---|---|---|---|
Appointments 2016 |
Appointments 2015 |
|||||||||
Property, Construction, Electircal, Installation & Plumbing |
52 |
54 |
56 |
51 |
213 |
76 |
58 |
49 |
49 |
232 |
Financial Services |
12 |
8 |
12 |
4 |
36 |
9 |
8 |
8 |
6 |
31 |
Healthcare & Social Services |
10 |
7 |
4 |
8 |
29 |
5 |
9 |
10 |
8 |
32 |
Hospitality & Leisure |
13 |
15 |
22 |
24 |
74 |
32 |
22 |
19 |
19 |
92 |
Film & Photographics, Media & IT |
9 |
14 |
25 |
13 |
61 |
14 |
16 |
13 |
11 |
54 |
Manufacturing Industries |
52 |
58 |
54 |
63 |
227 |
49 |
51 |
55 |
49 |
204 |
Mining, Energy & Agriculture |
11 |
10 |
5 |
7 |
33 |
10 |
1 |
11 |
5 |
27 |
Printing & Publishing |
5 |
5 |
3 |
4 |
17 |
6 |
7 |
5 |
5 |
23 |
Recruitment & Business Services |
48 |
51 |
39 |
52 |
190 |
35 |
59 |
50 |
48 |
192 |
Retailing |
29 |
19 |
17 |
27 |
92 |
36 |
17 |
25 |
18 |
96 |
Transport & Communications |
19 |
16 |
17 |
5 |
57 |
17 |
15 |
15 |
10 |
57 |
Wholesale & Distribution |
12 |
13 |
14 |
23 |
62 |
20 |
22 |
22 |
12 |
76 |
Other Services |
4 |
6 |
8 |
1 |
19 |
5 |
6 |
7 |
13 |
31 |
Grand Total |
276 |
276 |
276 |
282 |
1,110 |
314 |
291 |
289 |
253 |
1,147 |
Q1 2016 |
Q2 2016 |
Q3 2016 |
Q4 2016 |
Total |
Q1 2015 |
Q2 2015 |
Q3 2015 |
Q4 2015 |
Total |
|
Retail Insolvencies (>10 stores) |
2 |
5 |
1 |
3 |
11 |
4 |
2 |
0 |
1 |
7 |
Breakdown by region
Q1 2016 |
Q2 2016 |
Q3 2016 |
Q4 2016 |
Total |
Q1 2015 |
Q2 2015 |
Q3 2015 |
Q4 2015 |
Total |
|
---|---|---|---|---|---|---|---|---|---|---|
Appointments 2016 |
Appointments 2015 |
|||||||||
London |
84 |
78 |
80 |
71 |
313 |
82 |
82 |
61 |
75 |
300 |
Midlands |
38 |
36 |
27 |
41 |
142 |
45 |
39 |
46 |
32 |
162 |
North East |
41 |
38 |
46 |
51 |
176 |
54 |
44 |
43 |
26 |
167 |
North West |
59 |
41 |
61 |
59 |
220 |
70 |
62 |
65 |
64 |
261 |
South East |
26 |
51 |
45 |
40 |
162 |
42 |
44 |
49 |
36 |
171 |
South West |
22 |
24 |
16 |
18 |
80 |
17 |
20 |
22 |
20 |
79 |
Other |
6 |
8 |
1 |
2 |
17 |
4 |
0 |
3 |
0 |
7 |
Grand Total |
276 |
276 |
276 |
282 |
1,110 |
314 |
291 |
289 |
253 |
1,147 |
About Deloitte
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.
Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.
The information contained in this press release is correct at the time of going to press.
Member of Deloitte Touche Tohmatsu Limited.