Hotels are now one of the most stable sectors in the North West, indicating a turnaround in the industry’s fortunes, according to new figures from the insolvency trade body R3.
The figures show that just 17.5% of hotels in the region – or 142 out of 812 businesses – are considered to have a higher than normal risk of failure over the next 12 months, the lowest of any key business sector except for agriculture, where only 14.5% of businesses are considered at risk.
Hotels had a far lower risk score than restaurants (27.5%) and pubs (28%).
North West hotels also compared favourably with those in other parts of the country – only London (16.5%) and Yorkshire (17%) had lower risk scores.
The figures, compiled using Bureau Van Dijk’s Fame Database of company information, support figures from other sources which indicate that hotels in the North West have significantly improved in terms of profitability this year and that the industry is helping to drive employment growth.
They also follow Deputy Prime Minister Nick Clegg’s pledge to invest £10m through the Regional Growth Fund to boost tourism in the North.
Richard Wolff, North West chair of R3 and Head of Corporate Recovery and Insolvency at JMW Solicitors in Manchester, says: “It is clear that the hotel industry in the North West is improving its performance and businesses are now operating on a more stable footing.
“However problems do remain for many smaller operators, some of which are in need of significant investment and we hope that the new funding boost will help to address this. Whilst demand from business visitors and tourists remains strong in the key cities, it would also be good to see a stronger revival in the coastal towns which were once at the heart of the UK’s tourism industry.”