Number of bars and pubs entering administration increase

Recent research has indicated that the number of bars and pubs entering administration has jumped by 31 per cent in the past 12 months.

The research findings, conducted by accountancy company Wilkins Kennedy, showed that a total of 130 bar businesses entered administration in the third quarter of this year compared to 99 for the same period in 2009.

Wilkins Kennedy director Anthony Cork commented: “Despite growing economic recovery, bar companies continue to collapse at an increasing rate.”

With Christmas fast approaching, the busiest trading time of the year, it is unusual for leisure-related businesses to fail. Well known brand and bar operator Balls Brothers is one of these businesses.

“This lack of confidence from lenders is worrying news for the industry.” Cork said.

Balls Brothers was put up for sale by administrators at Zolfo Cooper at the end of November, owing its lender Barclays bank £7 million. It was reported at the time that several of Balls Brothers’ 19 wine bars were believed to be trading well, and would therefore be of interest to leisure business buyers.

The accountancy firm’s research found that bars and pubs have been adversely affected by increasing tax bills, which have been brought in over the past year. The recent snow is thought to be another contributing factor.

Mr Cork said: “Pubs and bars have had a tough time of it over the last year. Still reeling from the impact of the recession, they crumpled under ever increasing tax and legislative burdens which has left them vulnerable to a competitive threat from supermarkets.”

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