More green shoots in retail as rate of insolvencies falls
FURTHER green shoots for retailers have emerged as new data shows insolvencies in the retail and wholesale sector stabilised in 2013.
Some 202 retail and wholesale businesses were declared insolvent last year, an 11pc decrease on 2012, according to credit risk analyst Vision-net.
The findings add to data from the Central Statistics Office published this month which indicated that the retail sector returned to (very modest) growth of 0.1pc in November, for the first time since 2007.
"The figures indicate the upward trajectory of failure of retail businesses has begun to stabilise, and even decline," said a spokesperson from Vision-net. The data also showed that the number of business start-ups in the retail and wholesale sector increased in 2013 by 6.6pc to 1,776.
However, clear challenges remain for the sector. Last year saw some very high-profile retail insolvencies, including women's clothing chain A-Wear and shoe chain Barratts.
And a separate analysis of more than 14,000 retail and wholesale businesses found that 52pc showed signs of being at high risk of failure. There was a 2pc increase in the number of companies deemed to be at high risk in comparison to 2012.
The number of retail businesses classified as being at low risk of failure didn't budge last year, remaining steady at 35pc.
"The environment for the retail sector remains difficult, with the risk of collapse still high for many in the sector. With 273,000 people employed in the retail and wholesale sector, its importance is critical to the sustained recovery of the Irish economy," said Vision-net managing director Christine Cullen.
"However, data suggests that the spiral of business failures in the sector may be coming to an end."
Separate research, released yesterday by the Small Firms Association (SFA), showed that confidence continued to improve among small businesses in the final months of 2013.
Some 29pc of companies surveyed were more confident about their business than in the previous three-month period.
"Business confidence levels have shown further improvement through the final quarter of 2013, this is the strongest set of sentiment data we have seen in a few years," said SFA acting director Avine McNally.
"The survey indicates that the economy has stabilised; the challenge is now when the economy will commence to grow in a meaningful way. "