Retailers urge government to support businesses as insolvencies rise
Jewellery retailers are calling on the Government to do more to halt the number of rising insolvencies and help foster a ‘retail-friendly’ environment by tackling issues such as business rates and affordable parking.
This follows data compiled by research firm Local Data Company on behalf of professional services company PricewaterhouseCoopers, which revealed that retail insolvencies have risen by 9% compared to this time last year. The report also found that as cash strapped consumers reigned in their spending multiple retailers closed 20 stores a day on average between January and May this year, with jewellers among the hardest hit.
The findings reflect the mixed fortunes of the jewellery industry’s multiples. This year Hiho went into administration and closed its 14 stores, while 78-strong chain HPJ Jewellers was bought out of pre-pack administration by newly formed companies Gemstone Retail and Gemstone Operations, backed by restructuring firm Gordon Brothers. Jewellery giant Signet is continuing to focus on its stronger stores and plans to close 22 weaker locations this year, and was reported to be considering the sale of its UK arm earlier this year.
Independents have also been hit, with closures including that of London-based retailer Little 15’s bricks and mortar store. Retailers are now calling on the government to tackle high business rates, crime and the issue of affordable parking in town centres. Paul Henderson, director at six-strong retailer Wave Contemporary Jewellery said: “We’re at least 10% up on this time last year but it’s not easy. We’ve had situations with landlords wanting to increase rents, which is crazy right now. The government should redress business rates, because they’re really high and making it hard for businesses.”
London-based independent EC One is also 10% up on last year, but managing director Jos Skeates agreed the government needs to do more to support small and start-up businesses. He said: ” The main thing the Government is getting wrong is business rates. At our Ledbury road store we’re spending almost as much on rates as we do on the actual rent.”
He added: “Local parking restrictions are a real cash cow for the council but are a problem for retailers. At our Ledbury Road store we really notice the difference when parking becomes free in the area after 1.30pm and lifting the congestion charge in our area has helped. Tackling these issues could really help retailers.”
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