UK retailers facing critical financial distress up in Q4 2024: Report

As businesses faced subdued consumer confidence, escalating operational costs and challenging trading conditions following the Autumn Budget, 2,124 retailers were recorded in critical financial distress in the first 11 weeks of the October-December period last year.

This marks a sharp rise from the 1,696 distressed retailers in the July-September quarter and slightly lower—less than 1 per cent—than the 2,142 cases reported in the final quarter of 2023, according to British media reports.

"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," Julie Palmer, partner at Begbies Traynor, said.

"Adding to this uncertainty, the measures announced in the Autumn Budget...will significantly dial-up the challenges faced by these businesses," she added.

Earlier Begbies Traynor survey had revealed that 632,756 UK businesses were in ‘significant’ financial distress in Q3 2024—up by 5.1 per cent on the Q2 figure, and 32.3 per cent higher YoY. The number of businesses in ‘critical’ financial distress had fallen by 23.2 per cent QoQ to 31,201 in Q3 2024 and by 17.3 per cent lower YoY.

ALCHEMPro News Desk (DS)