Will retail insolvencies start the year - again?
It's hardly surprising to see retail administrations at this time of year - over-leveraged and under-performing retailers have minimum borrowings after the Christmas sales peak and secured creditors will naturally choose that point to stop the losses.
. . . constructive use of formal insolvency . . . can often add value when a business is saleable and the right restructuring team is brought in early enough.Paul's comment on the retail sector was:
I think the consumer has the last word on who survives - if they wish for identikit high streets, or doughnut towns, or McDonalds bacon sandwiches, so be it.History seems to be repeating itself. The Sunday Telegraph notes here this week that:
- Insolvency experts are on standby amid fears several high street retailers could collapse in January
- Consumers turn to sub-prime lenders as credit squeeze bites
- Footwear and clothing retailers have been particularly badly hit by the downturn in consumer confidence
But the way to address business stress is, as it was a year ago:
- take advice early
- ask a situational expert
- don't panic!
Date: 2nd January, 2008
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