The rate of bankruptcies among already vulnerable industries will accelerate in the future, predicts the credit reporting company UC. The worst is for the hotel and restaurant industry.
After evaluating its latest statistics for the first part of April, UC predicts that bankruptcies in the hotel and restaurant industry will increase by a whopping 197 percent in April compared to last year.
”"If I'm being modestly optimistic, perhaps the heat and outdoor dining can still have a certain positive impact in April. Several restaurants have been offering takeout for some time, but the question is whether it's enough. Many companies are reporting revenue losses of 80 percent or more and no company can handle it in the long run," says Richard Damberg, economist at UC.
Retail bankruptcies could increase by 74 percent, according to UC. It is the consumer goods sector in particular that is struggling.
”"With small margins, increased online shopping and high competition, even large chains will end up in restructuring or bankruptcy in this situation," comments Richard Damberg.
In total, the credit reporting company expects bankruptcies to increase by 28 percent compared to last year. Just over 700 will be limited liability companies.
”"We saw a sharp increase after the Easter weekend with 68 new bankruptcies, which indicates that the rate of bankruptcy will accelerate in the future. My thesis is that many entrepreneurs have spent Easter reviewing their company's finances and that many fundamentally viable companies will choose to put the company into reconstruction instead of bankruptcy, with the hope of being able to negotiate with, for example, landlords and other stakeholders," concludes Richard Damberg.
Source: di.se
