Warning lights on for high street retailers after Bank Fashion collapses

"With the first retail administration of 2015 hitting right at the start of the vital January sales period, I expect we’ll see more high profile casualties emerge before the month is up, “warns retail expert at Begbies Traynor, Julie Palmer.

As reported by the ‘Manchester Evening News’, retail experts have warned other high street stores may collapse after Bank Fashion fell into administration.

In this regard, Palmer adds that "The administration of Bank Fashion is hardly surprising as the struggling clothing retailer has been in the red for some time. However as Hilco Capital acquired the business just two months ago, we would have expected it to hold on to life a little longer."

"Unable to compete with the bigger national clothing chains, with their larger marketing budgets, greater brand loyalty and comprehensive online offerings, Bank simply failed to entice shoppers through its doors during the peak Christmas trading period and so has unfortunately paid the ultimate price."

Meanwhile, Marks & Spencer suffered a 5.8 percent decline in clothing and homeware sales over its Christmas quarter, surpassing City fears due to the mild weather, fierce discounting among peers and relevant issues at its distribution centre. These factors resulted into declining underlying sales (-2.7 percent.)

However, CEO Marc Bolland insisted Marks & Spencer had a “very good Christmas in food” with record sales, outperforming the market. Food sales were up 17 percent in the Christmas week as the retailer sold record numbers of turkeys, desserts and party food.

Struggling retailers likely to call in administrators after Christmas

Following these announcements, fears have grown for other high profile brands during the aggressive January sales. As market insiders remind, it is common practice for struggling retailers to appoint administrators immediately after the busy Christmas trading weeks.

Additionally, and as a recent report by Begbies Traynor showed, analysis detect a 54 percent increase in significant financial distress among UK retailers compared with last Christmas.

Across the Pond, teen apparel brand WetSeal is rumoured to be the next in closing its doors, adding to the concerns amongst high street retailers. The US fashion retailer has announced its intentions to reduce its commercial network in a 66 percent, laying off about 3,700 full- and part-time employees as closing 338 stores.

As the company explained, the closures follow the failure to re-negotiate meaningful concessions from landlords. Data made public reveal that the closed stores accounted for almost half of Wet Seal's net sales of about 317 million dollars in the nine months to November, 1.