Fifth of restaurants threatened with insolvency
New research has found that a rising number of British restaurants are going bust. This is thought to be a result of the Brexit referendum taken last year.
It is estimated that the number of restaurants declaring insolvency has risen by 13% this year, according to a study taken by accountancy firm Moore Stephens. It warns that 20% of restaurants, or 14,800 outlets, are threatened with closure, with the sector hit hard by the fall in the value of the pound.
The decision by the government to increase the National Living Wage has also further increased pressure on restaurant employers.
Restaurant chains Byron, Prezzo and Jamie’s Italian have all closed sites in the past year, while fast food chain Handmade Burger went into administration earlier this year.
In this highly competitive and desperate environment, restaurants have to think of new and innovative ways to set their business apart from others on the high street.
Jeremy Willmont, head of restructuring and insolvency at Moore Stephens suggests restaurants have to think fast to keep the consumer’s attention.
“A restaurant’s fortune can change remarkably quickly as consumers look for the next new and exciting opening. A restaurant not completely on top of market trends is going to struggle in this environment,” Willmont concludes.
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