Member Article

Over 90 Yorkshire and Humber hotels at risk of failure

Despite improvements in the UK economy, recovery in the hospitality sector remains sluggish with almost a quarter (22%) of the 417 hotels in Yorkshire and the Humber ‘at risk’ of failure, according to the latest research by R3, the insolvency trade body.

R3 adds that these figures, from Bureau van Dijk’s ‘Fame’ database, reflect the national picture: 22% of the UK’s 1,660 hotels are ‘at risk’ of failure in the next 12 months.

The figures for Yorkshire and the Humber show a slight deterioration from last year when 20% of hotels in the region were ‘at risk’ of failing.

Commenting, William Ballmann, chair of R3 in Yorkshire and partner at Gateley LLP, said: “The hotel sector across the UK has suffered from weakened demand in recent years with problems in the eurozone resulting in falling demand from overseas visitors in both business and leisure travel.

“With domestic consumers also feeling the pinch, there has been increased pressure on room rates as well as greater competition from the expanding budget chain brands at the expense of regional hotels.”

He continued: “Looking at the national picture, hotels in the region are faring relatively well and should benefit from any upturn in disposable income as consumers both here and in the European economies start to feel the effects of the long-awaited recovery.

“Hotels in Yorkshire should also receive a huge boost from next year’s Tour de France when more than 300,000 visitors are expected to descend on the region.

“However, with cash reserves depleted and high fixed overheads, there are still tough times ahead. Hotels need to adapt and remain competitive in order to survive.

“Careful planning and cash flow management can go a long way to help give businesses an edge, as can responding to the customer’s changing needs and investing wisely in branding and marketing activities when funds do become available. In addition, hotels need to identify what sets them apart from their competitors.”

This was posted in Bdaily's Members' News section by Mark Lane .