As More Restaurants Close, Owners Worry about Their Cash Flow

12th March 2018.

Amid troubles within the sector, a group of restaurant bosses have warned the government it must act to avoid “further damaging closures and job losses”.

A string of restaurants, from the likes of Jamie’s Italian to Byron, have lost the battle between higher costs and tough competition. Italian chain Carluccio’s have now also called in administrators after diminishing profits continued to threaten their presence on the high street. Business owners are working on shaky ground within the casual dining sector, and improvement looks unlikely unless something is done. A group of restaurant bosses have now written a letter to the Chancellor, Philip Hammond, asking for a reform to business rates. The soaring business rates have been a sore point for many business owners, from small businesses to high street chains, but no reform has yet been attempted.

When business owners find their profits at a lull, and business rates or inflationary pressure is building, there are alternative routes to liquidation. At the Credit Protection Association, we free up the cash flow for many of our business members, allowing them to expand and improve their business. Our debt recovery services chase down late payers and recover bad debt, allowing our members to not only avoid shutting up shop but return to the high street stronger than before.

The chief executive of cafe chain Bills and the chairman of pub and restaurant chain Mitchells and Butlers are among the 15 who signed the letter to the Chancellor.

The letter was penned ahead of the Chancellor’s spring statement on Tuesday, where its signatories described a “perfect storm” that has hit their sector.

They blamed “soaring business rates, rising employment costs and Brexit-fuelled inflation” for the difficult trading conditions.

“We need government action now to reduce the unnecessary costs of doing business if we are to avoid damaging closures and job losses,” the letter said.

“The sector is at a tipping point and needs focused attention now.”

We are living in the digital age, where online retailers have stolen the spotlight from brick and mortar shops, and online food delivery services such as JustEat have diminished the appeal of dining out. Businesses are struggling with stunted cash flow and profits and are looking for a way to improve their position. While issuing demands to the Government may provoke change, it will not happen overnight. What businesses can do immediately is turn their attention to their cash flow, and look for the easiest and most inexpensive way to improve it.

At the Credit Protection Association, we use our debt recovery services to get our members back money they thought they had lost. Late payers are forced to pay up, and invoices are paid in full, and our members can return to a healthy business. Our credit management products have also become increasingly important to our members since Carillion’s collapse, where credit reports and monitorng software keeps any bad payers at bay. As our economic and political future continues to be uncertain and technology continues to pose a threat to traditional concepts, it’s important business owners have the financial freedom to be prepared, and to fight back against the competition.