Editorial & Advertiser Disclosure Global Banking And Finance Review is an independent publisher which offers News, information, Analysis, Opinion, Press Releases, Reviews, Research reports covering various economies, industries, products, services and companies. The content available on globalbankingandfinance.com is sourced by a mixture of different methods which is not limited to content produced and supplied by various staff writers, journalists, freelancers, individuals, organizations, companies, PR agencies Sponsored Posts etc. The information available on this website is purely for educational and informational purposes only. We cannot guarantee the accuracy or applicability of any of the information provided at globalbankingandfinance.com with respect to your individual or personal circumstances. Please seek professional advice from a qualified professional before making any financial decisions. Globalbankingandfinance.com also links to various third party websites and we cannot guarantee the accuracy or applicability of the information provided by third party websites. Links from various articles on our site to third party websites are a mixture of non-sponsored links and sponsored links. Only a very small fraction of the links which point to external websites are affiliate links. Some of the links which you may click on our website may link to various products and services from our partners who may compensate us if you buy a service or product or fill a form or install an app. This will not incur additional cost to you. A very few articles on our website are sponsored posts or paid advertorials. These are marked as sponsored posts at the bottom of each post. For avoidance of any doubts and to make it easier for you to differentiate sponsored or non-sponsored articles or links, you may consider all articles on our site or all links to external websites as sponsored . Please note that some of the services or products which we talk about carry a high level of risk and may not be suitable for everyone. These may be complex services or products and we request the readers to consider this purely from an educational standpoint. The information provided on this website is general in nature. Global Banking & Finance Review expressly disclaims any liability without any limitation which may arise directly or indirectly from the use of such information.

High Street woes claim numerous casualties

payplanVisiting a typical town centre in the UK today, you’re likely to find at least a handful of empty retail units. While it’s been a common sight to find one or two empty units on the high street, that number has risen rapidly in recent years due to the collapse of some of the most famous names on the high street.

A fall in consumer demand coupled with rising unemployment and a marked increase in the cost of living all made for a difficult climate for the retail sector. The fact that so many household names have fallen by the wayside shows how hard it’s been for even seemingly successful companies to stay afloat. Here are just some of the big-name retailers who have gone under in recent years:

Struggling to keep pace with supermarket chains such as Asda and Tesco who entered the electrical retail market and online companies including eBuyer, the chain’s star had waned significantly last year. In the end all of its 236 stores were closed, while over 6,600 jobs were lost as a result of their eventual liquidation in late 2012.

Although some of the DVD rental firm’s stores are still standing, the bulk of their 500-plus stores have been closed. Having failed to compete with the likes of Netflix and LoveFilm, who successfully managed to corner the online rental and streaming markets, Blockbuster were forced to go into administration. The stores still trading have yet to find a buyer.

JJB Sports
Since the sportswear retailer was sold by founder and Wigan Athletic chairman Dave Whelan, their fortunes flagged massively in complete contrast to the success of rivals Sports Direct and a revamped JD Sports. The firm shut up shop for the last time in October last year, with 180 store closures and 4,000 jobs lost.

One of the oldest names in the retail sector, it seemed unthinkable that HMV would suffer the fate of going into administration. Although some stores in major cities were saved, 66 store closures were announced in February by administrators Deloitte with over 900 jobs shed. Their failure is down mainly to not keeping up with online retailers.

Before they disappeared from high streets across the country, they were the largest retailer of digital cameras in the UK. Unfortunately for them, demand for digital cameras had fallen due to the improving quality of in-built cameras on smartphones, while cameras were being sold for less by online retailers and other high street names. 187 stores were closed, while over 1,500 lost their jobs.

Like a number of fashion retailers, Republic had struggled to swim against the tide of competition from online retailers. The fact that their main target audience of younger people were hit hardest by the recession didn’t help matters either but a rescue deal has been put in place for the Leeds-based firm.

Clinton Cards
Previously the largest seller of greeting cards in the country, Clinton Cards had struggled to cope with online competition. The firm went into administration in May 2012, although 400 of its 750-plus stores had been taken over by American Greetings, Clintons’ largest creditor. The remaining outlets, including those under the name of‘Birthdays’ were closed down.

As one of the few dedicated computer game retailers, Game’s loss from city and town centres in the UK was keenly felt. As with many other struggling retail firms, failure to corner the online market had cost them dearly. Over 300 of their stores were sold to an investment firm, while the rest were closed for good. Hundreds of jobs were lost, but a handful of Game stores are still open.

Aside from the big high-street names, smaller regional and local retailers have found the going just as tough. Many have shut up shop forever while others have either been taken over or scaled down in size in order to adapt to harsher trading conditions.

Joblessness on the rise
While empty retail units are usually the first thing people notice when a company such as Comet or JJB Sports closes, perhaps the biggest consequence of all is when employees are laid off. When this happens they’re left to compete with those already looking for work for the vacancies that are still available.

Sadly, with the number of people in the UK officially out of work over 2.5 million, it’s going to be extremely difficult for workers made redundant by JJB et al to get back into employment straight away. They may find it harder to pay their bills, which could mean they have to take out emergency loans to plug the gap in income.

In times of need
The thousands of retail workers let go by firms in administration or on the brink of going out of business altogether are adding to the swelling numbers of people out of work, and for many a bleak future could lie ahead. In terms of personal finance in the few months after being made redundant, some could be forced to take drastic measures to even afford the basics in life.

“Once someone is made redundant through no fault of their own, it’s understandable that they might fear for their future”, said a spokesperson from Payplan.

“Finding another job is hard, especially in this day and age. If they go for months without finding a new role, they have no choice but to scrimp and save in order to make ends meet. However,in the event of a sudden emergency expense or benefit payment delays, they might have no choice but to take a loan out, which could be the start of a vicious cycle of poverty.”

One of the unfortunate by-products of the current economic climate that Payplan see increasingly often is underemployment.

“Underemployment is a growing problem – people who are working, but aren’t earning the salaries they were two or three years ago, are really going to struggle if mortgage rates or gas and electricity prices start to rise again. People who lose their jobs because the companies they have been working for disappear are often grateful to accept any employment; even if it pays less than they’re used to” the spokesperson added.

In any circumstance, losing a job is something no-one wants to go through, but in the event of mass redundancy due to their employer being forced to cease trading, it can affect someone for life. The retail sector isn’t showing too many signs of making a sustained recovery yet and it’s likely that more big retail firms could join the growing ranks of disappearing companies.