On-trade 'faces mounting pressure'

Published: 08 February, 2011

Forty-seven businesses in the pubs, clubs and bars sector went into administration in the final quarter of 2010, according to the Insolvency Service.

The figure compares to 38 in the third quarter, and 60 in the fourth quarter of 2009.

Creditors' Voluntary Liquidations rose by 5% from 189 in the third quarter of 2010 to 198 in the fourth quarter.

Simon Bower, partner at Baker Tilly Restructuring & Recovery LLP, said: "While the sector overall saw less casualties in 2010 versus 2009, the public sector cuts seem to have already had a negative impact on consumer confidence and there is certainly evidence of spending being reined in.

"Also, the adverse weather conditions discouraged customers from venturing outdoors to spend. This is true of some areas more than others, with more rural areas seeming to have fared worst overall."

He warned that the first three months of the current year will see pressure mounting on the industry, as the impact of VAT increases and rising costs take their toll.

But he added: "With many sporting fixtures and occasions such as the royal wedding taking place this year, savvy traders should make sure they are well placed to take advantage of every opportunity to aid recovery."

Printer friendly version