Clare Kennedy, Partner & Managing Director, comments on the ONS retail sales figures

“Today’s figures underscore the tough climate facing retailers, with rising costs invoking difficult decisions. While many have factored national insurance hikes and living wage increases into their forecasting, passing further costs onto consumers is no longer an option for everyone. Given the tough conditions, some retailers may be inclined to reevaluate staffing structures and closely monitor loss-making locations.

“While we’re yet to see a wave of restructuring activity as companies still weigh up their options, it may become inevitable as the pressure builds. Retailers in stronger financial positions will naturally weather the storm more effectively, while those that struggled through Christmas trading could now be in a far more precarious position. At the same time, private equity is returning to the market in search of growth opportunities, paving the way for consolidation in the coming months.”