British clothing retailer Suits You has collapsed into administration just eight months after entering a company voluntary arrangement (CVA), which aimed to save the Leeds-based business.
Administrators Zolfo Cooper said they would wind down loss-making stores, but support the chain’s successful branches and sell as much of the business and assets as possible.
The firm’s collapse is a sign of things to come. Expect to see more well-known consumer brands, high street retailers and public sector suppliers fail in the New Year.
Following the government’s recent spending review, no sector is going to be immune from carnage.
These cutbacks are yet to work their way through the economy and you can’t have cutbacks without business failure, it’s not possible.
Government departments and councils are big spenders; if they cutback on spending, businesses will suffer and eventually collapse.
Then, unemployment goes up and fewer businesses spend money, which means more businesses collapse; it’s a viscous cycle.
Every time a business collapses there are fewer employees with money to spend so other businesses become at risk of going under.
Therefore, they will be carnage in 2011 and 2012, but we won’t see it straight away because businesses will fight tooth and nail to stay afloat so there’s usually a delayed reaction.
If you’re worried about the future of your business’ finances, get in touch with Insolvency and Law now for confidential advice and guidance. Call 020 7504 1300.