Retail Carnage - Regular Updates

Each day seems to bring fresh news of carnage on the High Street. This blog will carry updated links to the most recent retail failures and their aftermath

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In the first of a new series of In Business, Peter Day quizzes bankruptcy and business reconstruction experts and offers a brief guide to how to go bust.

Here are some points jotted down from the programme:

Businesses in distress need to take rapid corrective action to increase their chances of survival Many executives / entrepreneurs have limited or no experience of an economic downturn Re-finance for struggling businesses has become tough to achieve - a dangerous feature of this economic cycle The majority of businesses do not have a site map which explains their business and which engages in worst-case scenarios to test how robust they will be in the event of an economic crisis - contingency plans can help a business survive Decisive action is needed to change the loss-making activities of a business CVAs - creditors voluntary arrangements - provide a short term breathing space for limited companies that are in financial distress Many small businesses rely on credit cards for short term finance - the early part of 2009 will put thousands of small businesses under enormous pressure.

The Independent today offers a brief guide for retail survival:

“In a downturn, retailers typically slash their capital expenditure – notably opening less new stores and refurbishing fewer existing ones, but also trimming IT spend; reducing stock; cutting staff numbers or hours in stores; and extending payment terms with suppliers or demanding that they contribute more substantially to a retailer’s marketing spend. Above all, one of the most powerful actions is to conduct a review of their store portfolio, in an effort to ditch the loss-making outlets.”