The popular retailers that could be in trouble in 2025 as the high street faces more pain due to Budget changes
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JANUARY is a tricky time for retailers. For those that are struggling, whether they survive or thrive depends on how much cash came in the tills over the festive season. If sales were disappointing or their profits came under pressure by having to offer bigger discounts than expected it’s likely they’ll be facing a bleak January.
The problem retailers face is a wall of extra costs that are coming down the tracks that will make troubled shops’ chances of survival even slimmer. The first blow will come from higher business rates bills. While the government has promised to reform the heavily criticised property tax, any changes won’t be until 2026.
That means retailers will face higher bills this year with the average shop business rates bill spiralling from £3,589 to £8,613 in April, according to real estate experts at Altus. Employees are one of the biggest costs for a retail chain and the Budget’s changes to national insurance contributions has made them much more expensive.
Part-time workers, which the retail sector relies heavily on, will be dragged into higher national insurance contributions. As a result, many retailers will have to cut costs even further through store closures, brand shutdowns and shrinking staff numbers.
Some retail names are more vulnerable than others according to restructuring experts. The fashion chain has been struggling for many years but its recent warnings that cash might run out has put it top of the troubled list. The retailer, best known for it women's party fashion ranges, warned at the start of December that a “significant reduction in revenues” could lead it to running out of cash in the new year.
