Jamie’s Italian is the latest high street restaurant chain to fall victim to the challenging high street restaurant industry having recently entered administration, just one year after entering into a Company Voluntary Arrangement with a view to enabling it to close a number of restaurants, in an attempt to secure its long term future.
A challenging marketplace
As one of the worst affected industries, official government figures show 1,306 restaurants and mobile food service operators in England and Wales entered into an insolvency process in 2018, a 35% increase when compared to 970 the previous year.
But why is the sector facing so much difficulty?
Rising costs of produce, changing consumer habits and low levels of brand loyalty due to highly competitive markets are just some factors that contribute to the demise of some high street dining brands. Stabilising a business against a challenging backdrop can be difficult – and often businesses fail to implement solutions early on.
What can be done?
Business owners should be aware of the threats facing their industry and take precautionary measures to mitigate these as soon as possible.
As a business owner, ask yourself – what makes you different? Is this differentiation enough to help you navigate any difficulties that may arise? How are your competitors fairing? How is market demand?
There are a wealth of opportunities in the restaurant industry, but it is vital businesses remain adaptable and tuned in to trends and changing habits.
If you are concerned
Time is of the essence when it comes financial difficulties, and seeking timely, candid and proactive advice from a professional before issues even arise is the best way to avoid any formal insolvency processes.
Financial pressures present themselves in many ways, and it’s not always clear whether these are temporary struggles or issues that will cause lasting damage.
If you have any concerns or would like advice, please get in touch and speak to a member of our dedicated Business Recovery and Insolvency team today.