The quiet departure from retail
The German Trade Association (HDE) is sounding the alarm: around 70 percent of brick-and-mortar retailers are complaining about declining footfall. Over 4,500 more closures are expected by 2025. The causes? Changing consumer behavior, online competition—and a government that is failing to take countermeasures.
The perspective of small and medium-sized businesses: Withdrawal is expensive
What many people overlook is that this development is not only a consequence of market logic – it is also the result of political inaction. Bureaucracy, high energy costs, a lack of tax incentives for investment, and urban decay are hitting small and medium-sized enterprises particularly hard. Owner-operated stores in particular often simply give up without even filing for bankruptcy.
From the perspective of small and medium-sized enterprises, the following is required:
- Relief on electricity and rental costs
- Tax incentives for investments in digitalization and infrastructure
- Urban development programs that consider trade, gastronomy, and culture together.
Legal perspective: The invisibility of liquidation
From a legal perspective, another problem is the increasing “informal market shakeout.” Companies are closing without restructuring or filing for bankruptcy—an indication of a lack of legal advice or access to restructuring options. This is dangerous because it puts creditors at a disadvantage, allows business models to disappear unseen, and eliminates any chance of reuse or transfer.
What is legally necessary:
- Better information about restructuring options (e.g., through the StaRUG)
- Promotion of early compliance and crisis indicators
- Mandatory consultation with qualified restructuring experts when ceasing business operations
Politics must take responsibility
The withdrawal of retail from city centers is not a natural disaster. Politicians can steer the course through tax incentives, infrastructure measures, and clear framework conditions. According to HDE President von Preen, reneging on promised relief (e.g., electricity tax) sends a fatal signal.
Retail is not an anachronism—it is part of our social fabric. Anyone who wants to strengthen small and medium-sized businesses must act now: legally, politically, and structurally.
Recommendations for action:
- Promote city centers as places to experience
- Expand insolvency prevention through early legal advice
- Ensure planning security through reliable political measures
