Recent research shows that in 2021, over 8,700 chain stores have closed due to the major shift in online shopping – partly caused by the coronavirus pandemic.
Overall numbers fell by 5,251 as the number of chain store closures outweighed the number of new store openings.
Out of all chains, fashion-based stores were affected the worst.
Coronavirus, however, is not the only factor to blame for these closures as many stores were already falling short before the pandemic, as they could not keep up with the demands of online shopping.
With stores closing at a rapid rate, tens of thousands of workers roles went with them too.
How can my business avoid insolvency?
Step one: improve cash flow…
- Send invoices promptly
- Chase outstanding debts
- Renegotiate credit limits and payment dates with suppliers
- Avoid overtrading and only accept orders you can take on
- Trim inventory with a stock reduction plan
- Reduce overheads and unnecessary expenditure
Step two: lookout for the warning signs…
- Business bank overdraft is nearing the limit
- Business is unable to extend existing credit agreements or access new credit
- Extended time it takes to pay suppliers
- Creditors are chasing payments
- Failed dealings with creditors
- Issues paying HM Revenue & Customs (HMRC)
- Received late HMRC payment penalties
- Issues with ordering stock due to unpaid debts
- Can no longer pay for wages or expenditures
Step three: seek expert help!
If you are worried that your company will become insolvent, then it is vital to seek specialist help as soon as possible to find any alternatives open to you and your business.
If you cannot cover your debts or pay your workers’ wages, then you must contact an expert immediately.
Please contact us today for more information.