West Midlands tourism and hotel businesses amongst least financially secure in UK warns R3 Midlands report

This is the highest percentage of any region in the UK and is close to three points above the national average (27.2%).

These statistics form part of insolvency and restructuring body R3’s monthly sector tracking report – compiled using Bureau Van Dijk’s Fame database – which also reveals an uncertain outlook for some West Midlands hospitality businesses.

Around one-in-five hotels (20.4%) in the West Midlands currently has a higher than normal risk of insolvency, which is one of the highest ratios in the UK. Only the South East has a greater proportion of hotels with an increased risk of insolvency.

R3 points out that there is positive news for the region, however, as the research reveals that the West Midlands construction sector is among the UK’s top regional performers, with fewer than one-in-four (23.6%) businesses operating with an above average risk of insolvency. This percentage is surpassed only by Northern Ireland.

Furthermore, the region’s manufacturing sector is among the top three most financially secure in the UK – outperformed only by Yorkshire and Northern Ireland - with fewer than one-in-five (19.2%) at higher than average risk of insolvency.

R3 Midlands chairman Chris Radford, a partner at the Birmingham office of Gateley, said: “These statistics paint a mixed commercial picture for the region. The situation won’t necessarily be helped by predictions of economic growth by leading forecasters, as businesses are now facing the effects of rising inflation hitting households and the uncertainty surrounding Brexit.

“R3 advises that the monitoring of finances should remain a priority for business owners as they seek to weather all eventualities. If cash flow becomes a major challenge, it is imperative to seek professional advice sooner rather than later. Never be tempted to stick your head in the sand."