Restructuring & Recovery - Advice For Retailers

Barry Knight advises retailers on how to keep their business on track.

Why do so many retailers get into difficulties, even in good times? There are three major reasons that might cause them to stumble.

Low barriers to entry

First, the financial barriers to entry into the UK's retail sector are very low. With an investment of about £40,000, someone could set up a shop within a month. This means that there are thousands of small retailers all competing against each other.

Over-expansion

The second factor is over-expansion. If you get it right, you can very quickly generate substantial cash flow. This often allows the acquisition of a second site, then a third, fifth, tenth and so on.