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The number of hospitality businesses entering insolvencies has risen by 13% between May and June this year, as operators struggle with trading costs, according to Buchler Phillips’ Hospitality Index.
Overall, the number of hospitality insolvencies rose by 1.41% in the first half of 2024, as some 1,801 accommodation and food service companies closed in the six months to June – having risen from 1,776 in the same period last year.
The Buchler Phillips Hospitality Index of insolvencies, which has tracked monthly figures since January 2014, rose from 204.3 in May to 231.6 in June.
Insolvencies within the industry peaked in August 2023 at 273.4, with a spike in the sector’s business closures.
Jo Milner, managing director of Buchler Phillips, said: “We’ve come a long way from last year’s tough summer when the hospitality sector was feeling the worst effects of higher energy prices and the cost of living crisis, but we’re not out of the woods yet: inflation is struggling to stay down after its fall this year and wage costs remain high.”
While hotel demand in major UK cities was lifted somewhat in June by Taylor Swift’s earlier concert dates, excessively wet weather this summer has discouraged consumers.
Hospitality operators are also hoping that October’s Autumn Budget will provide some relief on business rates or VAT.
