Hotel Industry Insolvencies

I’d like to start on a personal note by highlighting the very sad death, last week, of one of my heroes; John Martyn, the British singer, song writer, music legend, and guitarist extraordinaire. His jazz, folk, funk, and blues fusion was always original and utterly captivating. He’ll be sadly missed by his many devoted fans, and certainly by me. Rest In Peace, John, Rest In Peace.

And to continue the depressing tone of today’s blog, I feel the need to talk about recent insolvencies within the hotel industry. As the ‘credit crunch’, ‘economic tsunami’, ‘global recession’, or whatever you choose to call it, has over taken our personal lives, businesses, conversations, nightmares, television screens and newspapers, I have been reluctant to add to the ever-increasing depression surrounding our lives.

The number of small-to-medium sized hotels, motels, and guesthouses to go bankrupt in the UK over the last ten years has been reasonably high in comparison to other industries and businesses. However, large hotels and hotel chains have always remained stable with insolvencies peaking at forty-four in 2007. Whilst travel agent insolvencies had risen by 95% over two years in 2007, the percentage of bankruptcies within hotel chains had risen just a few percent per year until 2007.

However, I was not surprised to read in The Times Online today that Insolvencies in the hotel sector doubled over the winter and that “36 hotel businesses failed in the final three months of 2008, the highest quarterly figure since the early 1990s”. The Times revealed that, “the increase took the total number of insolvencies over 2008 to 87, almost double the total of a year earlier”.

For more information on the facts and figures please visit the Times Online article by Dominic Walsh at:
http://business.timesonline.co.uk/tol/business/industry_sectors/leisure/article5634691.ece

At this early stage it is impossible to foresee how long this downturn will last and how large an effect it will have on the hospitality industry, but judging by the delayed effect the crisis has had on the hotel industry, I wonder whether the effects will be seen long after the economy improves.

We just have to hope that the hotels with service and a product to be proud of come out the other end fighting fit and with fewer competitors; hopefully those hotels that should never have been in the industry in the first place.

Goodbye for now,

Emma

I am still on a search for the best hotel booking system for small to medium sized hotels. If you know of hotel booking software that can beat www.hotelsystems.co.uk for ease of use and functionality then please contact me on eharradine@hotmail.co.uk