Almost one-third of Irish retailers at risk of collapse, Vision-net warns

Nearly a third of retailers are in danger of collapsing according to Vision-net which has probed the accounts of more than 5,500 retailers.

The examination of 5,597 retailers across the country found that nearly 2,000 are on the brink of collapse, with a further 1,000 deemed to be at medium risk of failing.

The figures come as it was announced that HMV which employed 300 people in Ireland will not resume trading. Other high-profile collapses have included B&Q and Black Tie.

Managing director of Vision-net Christine Cullen said that the retail sector is being squeezed as a knock-on effect of the lacklustre economy and continuing high rents.

“The sector accounts for over 14% of jobs in the country but, as our figures show, the high street is feeling the impact of curbed spending as a result of pay freezes, job losses and sapped confidence. Anecdotally, we know that retailers and wholesalers are coming under increasing cost pressures from upward only rents,” she said.

The retail sector accounted for 14% of all business failures last year, but conversely the retail and wholesale sector also accounted for 11% of new start-ups.

The sector is still one of the largest employers in Ireland, accounting for 272,000 people, according to recent figures from Forfás. According to figures from the Central Statistics Office there was an annual decrease of 1% for December.

“However, last week’s deal on Ireland’s debt burden could generate positive economic sentiment which is key to a recovery in the retail sector. The latest figures from Ibec showing that consumer spending power is expected to stabilise this year and improve next year are encouraging, too,” said Ms Cullen.

Retail Excellence Ireland chief executive David Fitzsimons said there was little surprise that businesses were failing.

“Costs such as rent and local authority rates remain extremely high and the fact that landlords are still charging Celtic tiger rents which are not sustainable and will result in business failure and job losses in the retail sector,” he said.

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