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Big retailers could collapse, report warns

AAP logoAAP 1/08/2016 Petrina Berry

Seven more major Australian retailers are at risk of financial collapse in the next 12 months, accounting firm SV Partners says.

SV Partners declined to name the companies at risk of following the likes of Dick Smith into collapse, but says they are well-known brands with an annual turnover of more than $100 million.

These major companies join more than 1,200 retailers of all sizes across the country at high risk of financial failure in the next 12 months, the firm's August 2016 Commercial Risk Outlook Report warns.

SV Partners managing director Terry van der Velde says a number of retailers have gone into administration recently, including Dick Smith, Man to Man and Far Pavilions, and that analysis of financial records show more face a similar fate.

"Financial failure is almost certainly on the horizon for more than a thousand retailers of all sizes across the country, and significantly, for some big retail names," he said.

"Unfortunately, many of these businesses will not be able to hang on for the lucrative Christmas period."

Mr Van der Velde said an increase in online retailers and international brands opening stores in Australia have created more financial challenges for bricks-and-mortar retailers.

Clothing retailers have been identified as the most at risk in the sector, with 91 businesses deemed as high risk of financial failure, followed by the supermarkets and grocery stores, with 79 of these businesses on the brink of collapse.

SV Partners' predictions are based on the analysis of more than 20 million financial records in the past five years and examination of bill payments in the past two years.

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