THE NUMBER of hospitality and leisure businesses collapsing into insolvency fell 15 per cent in the third quarter compared with the same period last year, but it remains one of the worst hit sectors so far this year, according to figures released yesterday by PwC.
Overall, there were 1,464 insolvencies in the hotel and leisure sector in the past 12 months, up from 1,304 last year.
The number of failures fell to 299 during July, August and September from 336 in the same period last year, driven by a reduction in the number of pubs and restaurants having to call time. But restaurants were still the worst hit of all the hotel and leisure sectors in the third quarter with 156 insolvencies across the UK.
“Pubs and restaurants have had a good quarter in the fight against the recession. They continue to combat drops in discretionary spend by enticing consumers with promotions like set menu vouchers, happy hours, and multi-buy deals,” said David Chubb, PwC business recovery partner. But he added that the benefits of special offers can backfire for businesses.
“There are signs that consumers are now expecting this and are farming the offers without spending on additional courses or drinks which the promotion was priced to entice.”
The worst affected sectors last quarter were construction, with 631 insolvencies, manufacturing with 392 and 346 in retail.