Business owners across the hospitality and leisure sectors throughout the UK need to “take stock” and prepare themselves for yet another turbulent year, says Duff and Phelps.
The message comes as the financial solutions provider believes there is “no sign” of current restrictions easing.
It comes as current reliefs such as Business Rates and VAT are expected to end on 31 March 2021, with Paul Smith, managing director of the firms restructuring arm stating that “businesses need to revisit their financial plans” and review what agreements they had already “negotiated with creditors”.
According to Smith, this is to ensure that business owners in the sector keep a “viable level of liquidity; otherwise, they could face repayments on existing debt with little or no income”.
Smith said: “Current reliefs such as Business Rates and VAT are expected to end on 31 March 2021 as are the current crop of business support loans. Industry groups such as the Federation of Small Business are already campaigning for a year’s extension to Business Rates Relief for the hospitality sector.
“But realistically, hospitality businesses are not going to see a substantial return to trade before then, not least because of the lockdown across all four nations in the UK. “
He added:“Business needs certainty, and with the potential for the restrictions on creditor enforcement action being lifted at the end of March, we would urge anyone in the sector to contact us to help them navigate the path of renegotiation with lenders, landlords, HMRC and trade creditors at this critical time.”