Member Article

Administrations decrease 15% for North East retailers

Administrations for North East retailers have fallen by 15% in the last quarter, according to figures released by Deloitte.

The number of retailers that went into administration in the region fell from 33 in quarter two to 28 in quarter three, although any optimism within the sector is cautious.

Across the UK, 395 firms went into administration in the third quarter, which showed a decline of 25% year-on-year.

Neil Matthews, restructuring services director at Deloitte in the North East commented on the figures, and said more household names were coping under financial pressures.

He said: “The decline in the number of retailers falling into administration is positive news. As the year has gone on, low inflation has eased the pressure on consumers, particularly in the non-discretionary categories.

Wage growth is set to “outstrip” inflation next year, according to Deloitte, which will give consumers increased spending power.

Mr Matthews added: “Whilst the pressure is easing, the retail sector is still fragile. The real test will come in January once the busy Christmas trading period is over.

“Forecasts for the festive period are mixed. The challenge will be for retailers not to discount too quickly or too deeply to ensure they generate sales at acceptable margins in order to provide a stable platform for trading into the first quarter of 2013.”

This was posted in Bdaily's Members' News section by Miranda Dobson .