There will be few readers of The Yorkshire Post who haven’t turned to Mothercare at some point in their lives for help in bringing up children and grandchildren. Its apparently impending demise on the High Street will bring an undoubted sense of sadness for those who have grown up with the store, bringing back echoes of the collapse of Woolworths in 2008.
But the travails of the company, which started in 1961, are by no means an isolated story on the High Street as its UK retail business is put into administration, affecting 2.500 jobs and 79 stores. Other firms, such as Bonmarche and Karen Millen, have also gone bust in recent months, highlighting the ongoing challenges facing traditional stores in a rapidly-evolving world where customers are increasingly heading online.
Mothercare’s collapse has also highlighted once again concerns about business rates, which are based on a property’s ‘rateable value’ and have increased from 34.8p in 1990 to 50.4p this year - and are due to go up again in 2020. There is of course more than one simple reason why Mothercare is facing collapse, with retail analysts pointing to poor store layouts, but their problems will once again highlight growing concerns about the huge disparity in taxes for companies running real shops compared to those levied on online giants with no physical presence on the High Street. To take just one example, last year Amazon made revenue of £10.9bn in the UK but paid just £220m in direct taxes.
More big High Street names like Mothercare will undoubtedly be lost in years to come if more is not done to redress the balance.