20.1 C
London
Sunday, May 31, 2020

Block to spell thousands of pubs, restaurants and shops Business

The coronavirus pandemic is expected to lead to the disappearance of thousands of restaurants, pubs, chain stores and other businesses, despite the government offering unprecedented financial support and changing insolvency rules to give companies more time to pay off debt.

The national blockade has already forced the permanent closure of almost all branches of the Carluccio and Chiquito restaurant chains. Other large groups of restaurants, pubs and chain stores have warned that they could collapse if the government extends self-isolation conditions beyond the initial three-week period.

Fashion chain Monsoon Accessorize said Sunday it had been severely affected by the outbreak and was looking into a range of options. One is a sale of the company, which is being explored by the restructuring experts of FRP Advisory, raising concerns about the future of the 3,500 employees of the chain.

The number of people visiting the main street has fallen by three quarters since the government ordered non-key workers to venture out of their homes just to buy food, other essential services or daily exercise.

Retail intelligence firm Springboard said last Tuesday’s drop – the first day of the blockade – decreased 75.4% from the same day in 2019. “The annual drop in the UK drop on Tuesday March 24 is It was the most severe on any day since the beginning of the coronavirus epidemic, but it was even less than in Italy and the United States, “said Diane Wehrle, Springboard’s marketing and insights director.

Pressure on retailers was underlined by Goldman Sachs analysts, who predicted that Marks & Spencer’s sales of clothing and household items could decrease by 60% in the three months to the end of June. Credit rating agency Standard & Poor’s cut its M&S long-term debt rating from BBB to BB +, a degree often referred to as “junk” debt.

The crisis comes when new figures show that pub and restaurant activities were already under severe pressure before coronavirus hit the UK.

More than 1,400 restaurant businesses and at least 500 pub businesses went bankrupt last year, according to the accounting group UHY Hacker Young. The number of collapses in 2019 was 10% higher than in 2018 and included high-profile names such as Jamie Oliver’s British restaurant empire.

Peter Kubik, partner of UHY Hacker Young, said that restaurant chains could be the hardest hit by the coronavirus crisis. “Most other companies can move their staff home or sell on the Internet. Clearly this isn’t possible for pubs, “he said.

The restaurant group said most of its Chiquito restaurants will not reopen when movement restrictions are lifted, and neither will its 11 London-based Food & Fuel pubs, which will lead to 1,500 job losses.

The group, which also owns Wagamama and Frankie & Benny, has already blamed declining sales for deciding to close over 100 of its stores. The company is managed by Andy Hornby, who was chief executive officer of HBOS during the 2008 financial crisis, when the bank had to be bailed out by Lloyds TSB.

The Italian restaurant chain Carluccio is believed to be preparing to apply for administration. Restructuring specialist FRP Advisory confirmed that he was working with the chain, which has 73 sites and around 2,000 employees.

Fred Diamond, a consumer analyst at GlobalData, says that the outlook for the restaurant and pub sector seems increasingly bleak. “As people get used to insulation, making their home as comfortable as possible, street retailers will find it even more difficult to get people to leave their living room. By the end, the catering sector will have fewer stores and less cash, “said Diamond.

Subscribe to the Business Today e-mail newspaper or follow Guardian Business on Twitter at @BusinessDesk

.

Latest news

Simon Cowell claims to have lost four stones thanks to the vegan diet and block exercise

Simon Cowell claims to have lost more than four stones thanks to his new healthy lifestyle. British judge Talent, 60, has...

The International Space Station is visible over Wales every evening until June: here’s how to see it

Eagle-eyed skywatchers will have several opportunities to locate NASA's state-of-the-art space station over Wales in the coming week. The largest space station...

Lockdown plunges retail sales to April | Business

Retail sales declined 18.1 percent last month after falling 5.2 percent in March when the government introduced the national blockade.Almost every area of ​​retail...

The firefighters called to burn the trees

Firefighters have been called to burn trees on the edge of a Herefordshire town tonight (Friday). ...

Related news

Simon Cowell claims to have lost four stones thanks to the vegan diet and block exercise

Simon Cowell claims to have lost more than four stones thanks to his new healthy lifestyle. British judge Talent, 60, has...

The International Space Station is visible over Wales every evening until June: here’s how to see it

Eagle-eyed skywatchers will have several opportunities to locate NASA's state-of-the-art space station over Wales in the coming week. The largest space station...

Lockdown plunges retail sales to April | Business

Retail sales declined 18.1 percent last month after falling 5.2 percent in March when the government introduced the national blockade.Almost every area of ​​retail...

The firefighters called to burn the trees

Firefighters have been called to burn trees on the edge of a Herefordshire town tonight (Friday). ...

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.