Businesses across a variety of industries are facing unprecedented times in terms of operational challenges and financial uncertainty, but nowhere is that more true than the leisure and tourism sector.
In this article, The Insolvency Experts’ Craig Johns, a business recovery expert and experienced insolvency practitioner, explains the ways in which an early intervention can bring the best results.
Table of Contents
- The challenges facing the leisure industry
- A long road to recovery
- Impacts on leisure and tourism companies
- Support for leisure and tourism businesses
The challenges facing the leisure industry
With pubs and restaurants across the UK still under enforced closure, as well as the vast majority of domestic and international trips cancelled, leisure and tourism businesses have seen their streams of income cut at the present time. Whilst the government is offering significant assistance in some areas, many businesses in the hospitality trade still have considerable outgoings with regards to landlords and staff, even with the existence of furlough provisions.
At the present time, a level of flexibility and patience is vital from creditors, such as landlords, given the guidelines over when the industry will be able to function as normal being so tough to predict.
A long road to recovery
While many areas of society will begin to ease out of “lockdown”, the majority of leisure and tourism businesses will have a slower path to being fully operational, with reduced capacity likely for a time.
This reality brings a variety of challenges for business owners, with significant operating costs needing to be met at a time of reduced numbers. Another worrying alternative is that many of these businesses simply cannot afford to re-open even as society emerges from this time of lockdown.
Impacts on leisure and tourism companies
With regards to the tourism industry, even a major name like the Shearings Group has been left with no other option but to enter into Administration. After having to cancel all trips for the foreseeable future, the company has suffered severe impact and major cash flow issues. With no buyer emerging for the Group, it is now in the process of being wound down by its Administrators.
It is clearly very sad that a local and well-renowned business has been so negatively impacted through no fault of their own, but with ongoing Covid-19 uncertainty, they are likely to be far from an isolated case. Many businesses could find themselves in a similar position due to extended restrictions and stringent guidelines, making leisure and tourism the hardest hit sector of all.
Support for leisure and tourism businesses
This all paints a rather bleak picture, but for any leisure or tourism facing financial trouble, getting in touch with an insolvency practitioner doesn’t mean admitting defeat! Craig explains:
“Being brought into the situation at the earliest possible stage is crucial to secure a positive result. With sufficient time to fully understand the issues the business is facing, and the negative implications should the business fail, enables us to put in place a full strategy ensuring that all options can be explored and the chances of rescue maximised.”
If you are currently concerned about the financial future of your business, please get in touch with Craig and the rest of our Business Recovery team, who can provide a free initial consultation. We’re available by phone on 0300 303 8284, by filling out the short contact form on this page, or by requesting a Company Administration quote.