Staycationers Not Enough to Save UK Hotels

by Alfie FEATHERSTONE on September 11, 2009

With travelers concerned about the poor global economy and scared about the possibility of contracting the H1N1 virus, more and more Britons are choosing staycations this summer, which should be good news for hotels in the United Kingdom.  With these types of holidays, in which travelers choose not to go abroad, the United Kingdom has enjoyed a thirteen percent spike in the amount of holidaymakers staying in the UK.  However, this has not necessarily translated into increased revenue for UK hotels, which are seeing at least one insolvency every other day.

This number comes from a study done by Wilkins Kennedy, an accounting firm in the United Kingdom.  The study shows that over fifty hotels closed their doors between the months of April and June, which averages out to one hotel every other day.   This number represents a huge spike from this time in 2007, when over sixty percent fewer hotels filed for insolvency.

With higher numbers of travelers many within the industry are looking for answers as to why so many hotels are failing.  There are a bevy of reasons and most of them have to do with the struggling economy.  Banks are far less likely to loan money right now, which has left many hotels without the operating capital to continue on.

In addition, businesses are sending far fewer employees on business trips, which has more than balanced out the high number of staycationers.  In addition, businesses are booking fewer rooms for corporate affairs and customers are spending far less on extras like room service, and expensive spa treatments.

Comments on this entry are closed.

Previous post: Pacific Rent a Car Dealing with Car Hire Shortages

Next post: All You Can Fly Plan Announced by JetBlue