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Retail collapses “only the tip of the iceberg”

Via Courier Mail : AUSTRALIA’S retail landscape could be headed for more trouble with warnings recent high-profile collapses could be the “tip of the iceberg”.

Eleven more Australian retailers with turnovers of $100 million and three with turnovers of $500 million have been earmarked as “high risk of collapse” following this year’s crash of electronics retailer Dick Smith, Laura Ashley clothing and Earthborn homewares.

Earthborn liquidator SV Partners has released its Commercial Risk Outlook Report analysing financial records of Australia’s 2.34 million businesses, which showed several retailers in distress.

“Our analysis shows that three other Australian retailers are sitting in the same high-risk category as Dick Smith and Laura Ashley in December 2015, meaning we could see more big retail names in serious financial trouble in coming months,” managing director Terry van der Velde said.

“Economic and consumer pressures have brought some of the hardest trading periods in many years.”

More than 400 retailers in Queensland were identified as at high risk of failure, 250 of which were businesses with a turnover of $1 million or less. “What’s alarming is there are a number of retailers with turnover in excess of $50 million and a couple with $100 million, it shows a lot of retailers are hurting.”

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