East Mids hospitality sector back from the brink
New research has revealed that East Midlands hotels, pubs and restaurants are amongst the region’s most improved businesses in terms of financial security.
Figures compiled by insolvency body R3’s Midlands branch, using Bureau Van Dijk’s Fame database, show that under a quarter (23.7%) of hotels in the region are at higher than normal risk of insolvency, marking a five point decrease from the 28.7% at heightened risk in November 2015, less than six months ago.
Likewise, the proportion of restaurants [37.6%] and pubs [34.7%] with a higher than normal risk of insolvency has also fallen, reversing the increase registered by each sector in the previous quarter.
The outlook is also improving for the East Midlands manufacturing, construction, agriculture and retail sectors, all of which registered decreases in the percentage of businesses with an elevated risk of insolvency.
R3 Midlands chairman Chris Radford, a partner at the Nottingham office of Gateley, welcomed the results of the R3 research, but advised businesses to remain cautious.
He said: “These statistics are starting to paint a positive picture for business recovery in the region and the indications of growing sector stability are encouraging.
“There are, however, significant economic and legislative hurdles to overcome, not least the implementation this month of the National Living Wage. While laudable in its aims, it may impact greatly on those businesses with a high proportion of lower paid workers.
“With so much uncertainty still upon us, it’s important for all business owners to plan ahead and monitor finances carefully. If cash flow becomes a major issue, it’s imperative to seek professional advice before it’s too late.”
