Can a recession force shops to close down?

Question

Can a recession force shops to close down?

Answer 1

If your returns do not meet your outlay then you are running at a loss. This could be a seasonal variation. However, if the income of your customers drops because they are having to take wage-cuts or are being laid off or sacked, then the chances of your recouping your outlay are very small and probably non-existent. You have to decide whether to cut your losses because you will still have wages to pay and the charges for the lease/rental and running of the property will still be there.

Answer 2

Depends on what you sell.  Most businesses that cater to the rich are unaffected.