As well as the added pressure of a large rent payment, Rent Quarter Days
often see a spike in retail insolvencies because retailers will delay insolvency procedures until after rent is due, thanks to the complex rules on 'administration costs' that have developed in recent years.
R3 Midlands Chairman Richard Philpott, a partner at KPMG in the region, said: We often see a spike in retail insolvencies shortly after the traditional Rent Quarter Day
because of the added squeeze on cash flow, and also because of complex rules on administration expenses that incentivise retailers to wait for Quarter Day
to pass before going into administration.
But Graham Newton, partner at business advisory firm BDO, said he expected to see less "bloodshed" on the high street when the autumn quarter day
comes on Saturday.
That's the view of Steve Ross, pictured, chair of insolvency trade body R3 in the north east, who was speaking as the June Quarter Day
brought news of further business failures on the high street.
- when many retailers pay three months rent in advance to landlords - is often the tipping point for insolvency and previous quarter days
have seen the likes of Habitat, Jane Norman and TJ Hughes enter administration.
The quarterly rent payments that traditionally fall in March, June, September and December represent a significant outgoing for struggling firms in the present climate, with the equivalent Quarter Day
in 2011 seeing the largest wave of retail administrations since the height of the recession Well-known names such as Habitat, Zavvi, Whittard and The Officers Club have fallen into administration in the run-up to or period immediately following Quarter Days
over the last couple of years, as the pressure to meet property rental payments has finally proved too much for their finances, and addressing rental costs remain a central issue in the ongoing retail administrations today.
Some retail insolvencies at the outset of this new year, following the final rent quarter day
of 2012 which fell on Christmas Day, were inevitable as they form part of the retail cycle.
THE March rent quarter day
is set to trigger another spate of insolvencies across the business world, a Midland lawyer has warned.
It was the nearest hostelry to the Knightlow Cross where on the feast of St Martin, a quarter day
at the end of the agricultural year, villages within 12 miles of the ancient stone paid their dues to the Duke of Buccleuch.
The last rent quarter day
deadline on June 24 saw three months' rent being paid in advance for commercial properties, R3 said this was a "hefty bill" at a time when insolvency on British high streets has already seen more than 21,000 job losses since the start of last year, due to difficult economic conditions and the rise of internet sales.
What's more, 99 per cent of rent is collected within ten working days of the quarter day
The most recent rent quarter day
did not bring about the high-profile failures that some were expecting.