'Perfect storm' set to topple more high street names

Struggling London high streets will be hit by a "perfect storm" this week that could force some chains to fold, experts warned today.

The quarterly rent payment deadline is tomorrow and VAT bills also fall due in the next few days just as stores stock up for Christmas, placing huge strains on their cash flow.

At the same time the unseasonably warm weather is keeping many shoppers away from the fashion chains, which are now full of their autumn and winter ranges.

Mike Parkinson, a partner at Greater London accountancy firm Barnes Roffe, said: "Westfield and the West End may be booming, but it's looking very bleak in the wider London market. What we could be about to see is the perfect storm of certain high street retailers facing not only their next quarter rent being due this week, but also payment of their quarterly VAT liabilities. These will be coming after eight months of falling sales from reduced footfall into their shops, already depleted cash reserves and great difficulty finding short-term loans to cover spikes in their cash flow."

The period around the last "quarter day" payments deadline in June - when three months rent has to be paid in advance - saw the collapse of several retailers, including fashion chain Jane Norman, department store chain TJ Hughes and Habitat.

Siobhan Jones, at London law firm Manches, said: "London retailers have found the past few months to be extremely taxing and all the signs are that many may become casualties of the downturn."