The number of retailers in Scotland going bust has been at rate of just over one a week for the last ten years according to new analysis of the sector by leading accountants and business advisers French Duncan LLP. The firm has analysed official Insolvency Service statistics and found that 615 Scottish retailers have gone through a formal insolvency procedure and gone bust over the last ten years which is the equivalent of 1.2 retailers a week over 520 weeks.
Eileen Blackburn, head of Restructuring and Debt Advisory at French Duncan LLP, said: “Not many people involved in retail will be surprised at these figures as they simply highlight the difficulties which the High Street has faced over the last decade. Changing shopping habits, the dramatic growth in the popularity of online buying, and the punitive nature of business rates and rents have all contributed to the continued closure of countless shops in our city and town centres.”
“It is important to highlight that these are businesses which were made insolvent and closed down because there were no other options. This is likely to be the tip of the iceberg with many more retailers having closed down voluntarily before debts became insurmountable. For every insolvent business there are likely to be half a dozen others which closed before things became that desperate.”
Eileen continued: “We have seen a similar story playing out in the casual dining sector with enormous closures over long periods and our High Street shops remain as susceptible to these problems. From long established UK-wide names, to small independents, to familiar stores they are all facing the same issues of trying to remain relevant and attractive to consumers who have often turned their backs on traditional outlets. Equally councils and commercial landlords continue to remain unsympathetic to the shifting needs of retailers and the changing demands of the modern High Street.”
Eileen concluded: “It is clear that bricks and mortar are losing out to online clicks in the battle to stay afloat. Some of the issues are undoubtedly with businesses which failed to adapt to changing market trends but, equally, the landlords and councils are also responsible for inflexible and harsh rent and rate levels more suited to different economic times when the High Street was king. If the High street is to recover there needs to be effort on all sides to produce a more attractive offering to consumers which is priced accordingly to attract dynamic and vital young retailers back to the High Street to revive an essential part of town and city living. If something isn’t done then there will undoubtedly be more closures, and more darkened city and town centres attracting fewer and fewer shoppers.”
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