More retail CVAs expected in 2019
8th May 2019
Shopping centre owner Intu is expecting a rise in retail CVAs, saying it is expecting the number of retailers seeking out company voluntary arrangements to rise over the next seven months, as 2019 emerges as another challenging year for businesses on the high street. A number of major retailers, including Britain’s biggest department store, Debenhams, have entered into CVAs so far this year in a bid to cut down their rent costs, following on from 2018’s ‘year of the CVA.’ Against this backdrop, the retail landlord says that it now expects a steep drop in rental income this year, revising projections to predict that like-for-like net rental income in 2019 will decrease by 4-6% — a significantly bleaker outlook than previous predictions of a 1-2% drop.
In-store sales drop for third month
Many high street retailers have been struggling to stay solvent, as rising costs and disruption from online commerce combine with debt burdens and low consumer confidence to threaten liquidity. BDO analysis for April 2019 indicates that in-store sales were down for the third consecutive month in a row, with sales on the high street dropping 0.4% year-on-year for the month. Sophie Michael at BDO noted that, whilst the month’s drop “may not on the face of it seem significant,” in light of the “low benchmark” for recent sales figures and the seemingly “perfect shopping conditions” in April, the low sales figures paint a concerning picture for the high street.
Scottish retailers see record Q1 insolvencies
The threat of poor market conditions to businesses is starkly illustrated in Scotland, where a record number of retailers fell into insolvency in the first quarter of 2019. In total, 28 high street businesses collapsed from January to March, compared to 68 in the whole of 2018. In order to mitigate the risks posed by difficult market conditions, it is crucial for businesses to strengthen their credit management — chasing any late payments and streamlining overheads, to place themselves in the best possible position to weather the storm.
Record store losses
In an insight into the climate for retailers, Matthew Caines in the Telegraph on Tuesday 7th May cited PwC research which reveals that 5,833 high street shops had to close their doors last year, with 3,372 openings over the same period meaning a record net loss of stores.
Are you owed money by a retailer?
With pressures on the high street it is essential that you stay on top of the credit limits you grant retailers and watch carefully for any late payments.
You can’t just assume your customers can and will pay you, no matter how big their name is.
It is essential to have credit management systems in place to monitor and check your customers credit worthiness.
It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.
See the section below – About CPA.
Are you also at risk of collapsing?
If you are struggling like the above retailers, rather than shutting down, do you realise you may have a hidden source of capital within your business waiting to be activated?
If you trade with other businesses and were often paid late then you could be entitled to significant compensation.
Under little known and underused legislation your business could be due huge amounts in compensation that you didn’t even know about.
That compensation could be the cash rescue your business needed.
How can CPA help?
CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.
We do the work, you receive the cash.
If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.
We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.
We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.
CPA is passionate about late payment
The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.
We are passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.
If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.
As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.
Under little used legislation, you are entitled to compensation for those late payments.
Now you can boost your own cash-flow.
CPA can help unearth the those hidden treasures.
We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.
Yes, CPA can help you boost your business cashflow.
Don’t et your bankers control you, contact CPA today.
About CPA
The Credit Protection Association can help!
Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.
At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.
We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.
Companies in trouble usually have very bad bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.
If you supply to big companies like office outlet or small ones, help us help you identify the risks.
Why use a third party collector?
As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When you customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.
Over the years we have collected billions in overdue invoices for our customers.
Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.
Ready to speak to an advisor?
For help or advice on credit management, entirely without obligation.
Call us today
0330 053 9263
The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!
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Read our blog -Credit Management that works!
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