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Retail administrations have dropped to their lowest level since 2007, according
to research by business advisory firm
Deloitte.
There were 290 retail administrations in 2009, a drop of 11% compared with the
327 seen in 2008, while up 4% on the 2007 low
of 277.
Retail administrations steadily declined throughout 2009, with the spike of the
fourth quarter of 2008 and the first quarter
of 2009 at 111 and 124 administrations respectively, down by almost half in
second quarter of 2009 to 63.
Lee Manning, reorganisation services partner at Deloitte commented: "The steady
decline in retail administration figures is
encouraging, particularly now as we begin to emerge from the recession.
"There are a number of factors which have been at play here. Reported consumer
spending has held up far better than
expected.
"Equally, retailers have responded well to the recessionary environment, and
have better managed their cash flows
and stock levels.
"This has been reflected in less aggressive discounting strategies, which have
in turn helped to maintain profitability.
"We are aware of several successful CVAs in the sector, as well as a number of
informal agreements by retail landlords that
have enabled the trading of more marginal high street retailers to continue.
"We continue to expect an increased use of
retail CVAs as a successful alternative to administration".
Source:
RedAlert
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