Small UK retailers under huge pressure, many could fail - report
Independent retail businesses could see closures accelerating post-pandemic with debt at such firms having risen five-fold compared to the pre-Covid period, a report has claimed.
Former Wickes and Iceland boss Bill Grimsey has backed research into the situation and said such businesses could be headed for a “tsunami of closures”.
The report said that around 150,000 small firms now have a total of £2.3 billion worth of debt, which doesn’t include any rent they owe, but does include government-backed borrowings as a result of the pandemic.
He said around a third of the companies could be at risk of default, which would damage high streets, town centres and other retail destinations across the UK.
Reported by The Guardian, he said he feels urgent support is needed as, for many, the levels of debt taken on have been unsustainable. That support, he believes, should include the government writing-off loans with a suggestion that the roughly £2 billion returned by large retailers such as Tesco and Sainsbury’s could be used for this. “The French government is already working on a policy to save small businesses from being crushed by debt and we need to do the same to save thousands,” he told the newspaper.
Businesses had to start making their first repayments on governments loans last month, just as the furlough payments system was wound down, but also as Covid case rates rose and more staff were forced into self isolation.
Grimsey also thinks so-called non-essential small businesses that had to shut their shops during lockdowns should get a business-rates holiday until next April and also concessions on the timing of VAT and other tax payments.
Such businesses don’t only include retailers but also service firms such as hairdressers and beauty salons.
Copyright © 2023 FashionNetwork.com All rights reserved.