The wave of retail bankruptcies in the United Kingdom grows

In the UK, retail stores are being forced to close their shutters one after the other due to Covid-19 lockdowns, changing consumer habits, rising interest rates and the cost of living.

One of the nation’s largest retail chains and employing 12,000 people, Wilko’s bankruptcy filing earlier this month drew new attention to the retail sector’s woes. The number of bankruptcies in the retail sector is expected to rise further in the coming period after Wilko, which has 400 stores across the country, took up the bankruptcy flag.

According to data from the British Retail Consortium (BRC), approximately 6,000 stores in the country had to close their shutters in the last 5 years.

According to BRC data, in the second quarter of this year, 17.8 per cent of mall retail stores and 13.9 per cent of high street stores are empty in the UK. Retailers, struggling with rising rent, energy and employment costs, are having a tough time as consumers cut spending in the face of the high cost of living.

GIANT COMPANIES DOWN BLINDS

Argos, the country’s leading furniture and goods chain, announced plans to close around 100 stores this year and by 2024.

Michael Murray, chief executive of Frasers Group, with which the House of Frasers clothing and home chain is affiliated, said he expects closures in the retail sector to increase and that chain stores are regularly reviewed.

Boots, the nation’s leading personal care and pharmaceutical chain, announced in June that it plans to close 300 of its stores over the next 12 months. The number of stores at Boots, a US subsidiary of Wallgreense, is expected to decrease from 2,200 to 1,900 by June 2024.

Marks & Spencer (M&S), one of the country’s leading retail chains, announced in May that it plans to close 20 of its stores this year.

H&M claimed that 4 of its UK stores will be closed early this year, while clothing chain Superdry had to pull down the blinds on 8 of its UK stores recently.

The country’s entertainment venues, which are struggling with energy prices and costs, have also been hit by the winds of bankruptcy. As of June, the number of entertainment venues in the country that went bankrupt in the past 12 months increased by 80 percent to 729.

‘THE GHOST CAN BECOME THE CITY’

It is feared that shopping streets will become a “ghost town” as the country’s retail stores file for bankruptcy one after another.

In recent years, famous chains such as Topshop, Miss Selfridge, Dorothy Perkins, Debenhams, Oasis and Warehouse have had to close their stores on Oxford Street, where the heart of shopping in the London capital beats.

The replacement of some of the empty shops on Oxford Street by cheap American sweet shops is the most visible example of the change in the country’s shopping culture.

Westminster City Council announced a support package of around £10 million for small businesses last month to restore the street to its gleaming glory. The support is intended to revitalize Oxford Street, which is the showcase of the country.