Businesses are not only subject to failure through competition, bad decisions and fluctuations in the economy. The weather can also wreak havoc! We saw that the Beast from the East caused plenty of store closures. An example of this is Debenhams that had to close 100 stores in February due to the freezing conditions.
Sales at Debenhams fell by 2.2% in the 26 weeks to 3 March, while profits sank 84% to £13.5m. They have now lowered expectations for annual profits and announced that its chief financial officer, Matt Smith, has resigned to join rival Selfridges. Debenhams said profits for the full year would now be at £50m - £60m, compared with £95.2m for the previous year.
The cold weather also hit the wider retail market with UK sales falling 1.2% in March. The Office for National Statistics reported that sales were down by 0.5% for the first three months of 2018, the biggest quarterly fall since the first three months of 2017.
Trade Credit Insurance
Bad weather, natural disasters and a lack of consumer confidence can affect businesses and their ability to pay suppliers. There are so many unforeseen factors that seem to emerge from nowhere. Consequently, trade credit insurance is becoming increasingly more important. Business owners are generally control freaks, so why not take more control with a credit insurance policy to ensure bad debts don’t destabilise your business.
For more information on credit insurance and how it can enhance your growth and security as a business, please do not hesitate to get in touch for a no-obligation discussion about a CMR managed policy.