The Government’s roadmap out of lockdown signals a return to trading for a number of businesses hard-hit by the COVID-19 pandemic. There is however potential for heightened financial distress in the coming period as existing support measures are withdrawn and currently deferred liabilities become payable, bringing the challenges faced by this sector into sharp focus.

The onset of COVID-19 has precipitated and accelerated substantial change for businesses in fashion retail, adding to particular headwinds already facing the sector in the UK. While many brick-and-mortar fashion retailers were already experiencing challenging trading conditions at the start of 2020 – ranging from rent and rates overheads to increased online competition – restrictions on and changes to consumer preferences resulting from the pandemic have intensified the challenges facing many fashion retailers and businesses operating in the supply chain.