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Fall in hospitality and leisure insolvencies

22 | 04 | 13

The number of insolvencies in the hospitality and leisure sector in the first quarter of 2013 has fallen compared to the same period last year.

Figures from PricewaterhouseCoopers (PwC) show that insolvencies were down 27 per cent in the first three months of this year compared to 2012.

They have also dropped by ten per cent on the fourth quarter of last year.

PwC's figures show that hospitality and leisure insolvencies have continued to fall quarter on quarter for the past year and are now at their lowest point since the end of 2010.

In total, there were 1,794 insolvencies in the sector over the past 12 months compared to 1,816 last year.

The biggest drop between the end of 2012 and the start of 2013 was seen in restaurants, where insolvencies fell by 13 per cent.

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

He added: "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."

Mr Chubb claimed the challenge that restaurants are now faced with is to work out how to pass on increasing food prices to the customer.

This is particularly difficult as "recessionary behaviours" have now become the norm and consumers continue to focus on "buying clever and dining out clever".

The news that restaurants seem to be coping well with the economic downturn is positive for catering and kitchen equipment suppliers, who will continue to find their own services in demand.ADNFCR-16001031-ID-801575162-ADNFCR


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