Coronavirus: Thousands of UK pubs and restaurants at risk of collapse
Thousands of UK pubs and restaurants could collapse due to coronavirus, as the latest research showed that insolvencies in the sector spiked before the outbreak.
The number of restaurant and pub insolvencies jumped 10 per cent last year to 1,452 and 526 respectively, highlighting the weak state of the UK’s leisure sector before the pandemic.
The government has ordered the closure of all pubs, restaurants, bars and clubs in order to slow the spread of the virus.
The leisure and hospitality sector will benefit from a business rates holiday, access to government backed loans and a job retention scheme, however there are fears that the pandemic will result in many insolvencies.
High street restaurant chains have already started to feel the impact of the outbreak. Carluccio’s has hired FRC Advisory to assess its options, while Wagamama owner The Restaurant Group appointed administrators to its Chiquito and Food & Fuel chains.
Peter Kubik, partner at UHY Hacker Young, says: “There are few sectors that are going to be more heavily impacted than pubs and small restaurants.
“Most other businesses can shift their staff to home working or sell through the internet. Clearly that is not possible for pubs.
“For those restaurants that decide to carry on selling takeaway food they face the problem of having to give delivery companies a very large percentage of their remaining income.
“Both the pub and restaurant industry feel they need more specific assistance from the Government.”