The number of UK retailers facing “critical” financial problems has risen by more than 25% in the last three months, data shows. Highlighting the pressures on the sector, after a disappointing Boxing Day, the restructuring specialist Begbies Traynor has reported there were 2,124 retailers in “critical financial distress” in the first 11 weeks of the October-December quarter. That is a jump from 1696 in July-September, but slightly lower than the 2,142 recorded in the last quarter of 2023. Begbies, the UK’s largest insolvency practitioner, says the quarter-on-quarter increase reflects subdued consumer confidence and rising costs. Julie Palmer, a partner at Begbies Traynor, said retailers face pressures such as rising operational costs and squeezed consumer spending. Palmer added: “Moreover, the weaker-than-expected retail sales performance in November, traditionally a critical month for the sector, further underscores the tough trading conditions, as consumers hold off on purchases amid low confidence and rising prices. “Adding to this uncertainty, the measures announced in the autumn budget, including the planned increase to employers’ national insurance contributions, will significantly dial up the challenges faced by these businesses. These changes, alongside increases to the minimum wage, will negatively impact cashflow and, consequently, we expect elevated insolvency levels across this sector during 2025. “Even for more resilient businesses, the pressures remain relentless, and many will likely face financial challenges next year as they navigate these compounded difficulties." Begbies Traynor also reports that an additional 28,747 retail businesses in the UK are in "significant" financial distress – less severe than "critical" but still concerning. Cost of living pressures have been blamed for a drop in shoppers hitting the UK high street yesterday. The traditional Boxing Day sales seem to have been something of a flop, with a 7.6% drop in footfall compared with 26 December 2023 as of 8pm last night, according to data from MRI Software. The agenda • 4pm GMT: Russia’s retail sales and unemployment rate for November We'll be tracking all the main events throughout the day …
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