The retail sector has been hit hard by the cost of living crisis as many face challenging trading, but there are options to remain afloat, explain Helen Martin, senior associate and Joanna Charter, senior knowledge lawyer at Stevens & Bolton LLP
After a sharp rise in May, it came as little surprise to see corporate insolvency figures continue their march upwards. A total of 2,163 registered companies entered an insolvency proceeding in June 2023: the second highest figure since January 2019 and 40% higher than the equivalent for June 2022.
Retail continues to be one of the hardest hit sectors. Pressures on the high street pre-date the pandemic – the years following the global financial crisis saw an almost constant procession of familiar high street retailers hit the headlines as they struggled through various attempts at restructuring, in many cases finally resulting in an undignified demise.
It is an industry with complex market drivers, including challenges resulting from the pandemic (such as changes in working practices resulting in less footfall in larger towns and cities, and a growth in home delivery), supply chain disruption (including supplier insolvency), the role of artificial intelligence (AI) in automating decision making, and pressures to become more sustainable and provide more transparency around supply chains.
