‘Quarter day’ looms for retailers
THE year’s final ‘Quarter day’ – when many retailers must pay three months rent up front – is on Saturday, but insolvency specialist Dermot Power expects fewer casualties than in previous years.
The last quarterly rental payment before Christmas has pushed a number of High Street names into administration in the past, such as TJ Hughes, Habitat and Jane Norman.
But Mr Power, an insolvency partner at the Manchester office of accountancy group BDO, believes the economic climate will make landlords more flexible.
He said: “While some retailers have moved to monthly payments, the quarter day still remains a hurdle for many companies’ cash flow.
“Retailers have had another tough and testing year, and Q4 sales and the January sales are critical for the vast majority. They have a hard task in finding ways to encourage people to spend money with them rather than their rivals, and this comes down to offering them what they want, new products and value underpinned by superior service.”
He said retailers will be pushing for monthly payments and landlords will need to negotiate to avoid more empty units.
He added: “Given the current trading environment and enlarged vacancy rates, negotiations are likely to come to a head. Retailers will be calling for more flexible arrangements that will not only be in the interest of the high street but for landlords too who cannot afford to see more retail space on the market.”
