Bennetts' problems highlight pressure on retailers
PUBLISHED: 15:42 13 March 2011
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The appointment of administrators has raised questions over the state of retail, and particularly the electronics sector, in the region.
Bennetts managing director Mike Jones said the company had been hit by a lack of consumer confidence, rising rents and competition from online retailers and supermarkets.
In November, shortly after the release of its Christmas catalogue, a credit insurer withdrew its support, leaving the company unable to meet many orders over the key festive trading period, leading to the appointment of PKF.
Mr Jones added: “My fear is that as time goes by you will see more pressure for cheap online solutions to sell products as opposed to traditional retailers showcasing products with the staff service and everything that goes with it.
“The pressure will be on retailers because more and more people now find it comfortable to buy online.”
Figures from the British Retail Consortium showed a worse-than-expected 0.4pc decrease in sales in the high street as a whole last month, compared to February 2010, and concerns have been raised over increased competition, particularly in the electronics sector.
Adrian Fennell, partner in charge of retail at chartered surveyors Roche, said there were “mixed messages” generally in retail, with some brands struggling while others continued to expand.
While John Lewis this week announced a 10.6pc increase in sales in 2010, Mr Fennell said other companies which struggled to “distinguish” themselves in the market place were forced to compete solely on price.
He said: “If you are in the general melee it is very, very difficult.
“Bennetts is a medium-sized regional business, with reasonable buying power, but not in comparison to the likes of Currys and John Lewis. It is a struggle to compete.”
Davina Tanner, vice president of Norfolk Chamber of Commerce and its spokeswoman on retail, said she was “sad” at the news at Bennetts, and said sales of bulky items like washing machines had been hit as the housing market had slowed.
She added: “It is a very competitive market place. Everyone is trying to fight for that market share. Added to that challenge for sellers of big value products is that people are moving home less.”