The failure rate is the percentage of retail businesses that close down within a specific period. It is a measure of the industry’s survival or success.
Failure can occur due to various factors such as poor management, insufficient market demand, fierce competition, economic downturns, or inadequate financial resources. A high failure rate indicates a challenging environment for retailers, often associated with risks and volatility. It highlights the importance of effective business strategies, adaptability, and understanding customer needs. Retailers must focus on factors like market research, customer experience, product assortment, pricing, and operational efficiency to mitigate the risk of failure and sustain profitability in a dynamic retail landscape.