THE number of struggling retailers in Bournemouth has increased significantly, research suggests.

Business recovery specialist Begbies Traynor said pre-Christmas trading failed to reduce the financial pressure on retailers.

The number of shops in the town in significant financial distress rose by 37 per cent – from 59 to 81 – year on year as the price war between the major supermarkets and discounters Aldi and Lidl continued to take their toll on smaller businesses, Begbies said.

But between October and December, there was a four per cent drop (from 84 to 81) in the number of general retailers in significant distress, defined as businesses subject to county court judgments up to £5,000 and dwindling credit scores.

The trend was in line with the national picture, which also saw a four per cent drop in the figure for the final quarter and a 36 per cent increase annually.

Among food and drug retailers in Bournemouth, levels of significant financial distress fell 56 per cent from one quarter to the next, from 18 to eight, but annually distress levels remained unchanged.

Julie Palmer, regional managing partner at Begbies Traynor in the south west, said retailers faced generational shifts in consumer habits.

She said: “Whilst the run-up to Christmas 2014 brought some relief to hard-pressed retailers, the fact is the sector is experiencing unprecedented changes in the way people make their purchases.

“Online retailers, which we all know are experiencing phenomenal growth, are using their reduced overheads to keep prices low and that is determining consumer behaviour and hitting those with traditional retail space. As for food retailers, the German discounters have massively disrupted the UK market, bringing us cheap food like we’ve never seen before, and creating a classless shopping experience as people of all backgrounds are buying their groceries from them.”

She added: “It’s going to take a lot to persuade many British consumers to pay more for their food.”

She also warned that the problems of the retail industry were filtering through to the supply chain.

“There were four cases of significant financial distress among food firms in Bournemouth, when there had been none the previous year.