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Hospitality industry faces crisis with rising insolvencies
Hospitality industry in crisis as one in eight cafes and restaurants close annually, warns expert Tim Brace
Hospitality industry in crisis as one in eight cafes and restaurants close annually, says Tim Brace, Director at SV Partners
– One in eight cafes and restaurants exit the market annually, with accommodation and food services causing many insolvencies in Victoria.
– Hospitality struggles with rising costs, regulatory burdens, and delayed expert advice, often after legal action begins.
Australia’s hospitality industry is under mounting financial pressure, with rising operating costs, supplier debts and regulatory burdens threatening business survival.
Around one in eight cafes and restaurants exit the market annually, while accommodation and food services account for nearly one in six insolvency reports in Victoria.
On State of Hospitality, host Jeremy Koadlow speaks with Tim Brace, Director at SV Partners, who has more than 20 years of experience in insolvency and business recovery, about the warning signs of financial distress and how struggling businesses can get back on track.
Rising wages, rent, insurance, utilities and delivery costs are squeezing margins, while many operators fear passing higher expenses on to customers.
Delayed tax payments and unpaid suppliers can signal deeper cash flow problems and put daily operations at risk.
Brace highlights the importance of seeking professional advice early, with eligible businesses potentially able to restructure debts before financial pressure becomes unmanageable.
Jeremy Koadlow with Tim Brace at the Ticker News Studio
Options include small business restructuring and voluntary administration, depending on the circumstances.
The discussion also examines calls to reduce regulatory burdens and red tape, with early intervention and effective financial management key to helping hospitality businesses navigate financial challenges and avoid insolvency.
For more information, visit New Chapter Legal.
