97 collapses in travel and tourism sector since Q2 2011, finds research

97 collapses in travel and tourism sector since Q2 2011, finds research

Business failures in the hospitality and leisure sector have dropped to their lowest point since the last quarter of 2010.

There were a total of 1,794 insolvencies in the sector in the past 12 months compared to 1,816 in the same period the previous year, according to the latest PwC analysis.

Failures in the first quarter of the year were down 10% on the final three months of 2012 and down by 27% compared to the same quarter last year.

The biggest drop between quarters was seen in restaurants, which saw a 13% fall.

But insolvencies in travel and tourism nudged up to 12 in the first three months of the year against 10 in the final quarter of 2012.

The research shows a total of 97 collapses in the travel and tourism sector since the second quarter of 2011, against 339 hotels and 1,386 restaurants.

PwC business recovery partner and hospitality and leisure specialist David Chubb said: “With the fact that H&L insolvencies have continued to fall quarter on quarter for the past year and are now at their lowest point since Q4 2010, perhaps this is a sign that the remaining businesses have adapted to the current economic conditions in order to ensure their survival.

“Restaurants have had a good quarter but I think it is difficult to read too much into this quarter of results. It may be that consumers are getting used to the new normal and certainly the culture of eating out now seems built into the UK consumer psyche.

“The challenge restaurants have going forward is how to pass on increasing food prices to the customer, especially as recessionary behaviours are now the norm and the focus on buying clever/ dining out clever has certainly stuck with the consumer.”


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