It’s no coincidence that a flurry of retailers have hit the wall in the past week

A researcher from Sky News rang me a couple of hours ago, following the turmoil in the retail market over the past week. One of the questions he asked was “why is this all hapenning now?”

It was a good question. After all, while everyone knows it’s tough, trading conditions haven’t just turned bad overnight, and on the surface the retailers that have failed haven’t got a huge amount in common.

But the timing isn’t any coincidence. Last week was rent quarterday, when all retailers which pay rent in the traditional way had to pay three months’ worth in advance.

Us journalists who follow retail know that most retailer failures happen in the period immediately after rent day. Because of those failures, lots of landlords are going to end up with lots of empty shops.

Surely there’s a better way? I’m not saying that these businesses may not have failed anyway, but with cashflow being so vital in difficult times, wouldn’t it make sense for businesses to pay for property monthly in arrears, as you’d pay for anything else? After all, what other service do you pay for three months before you actually use it?

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