Commenting on the Government’s £1 billion support package for businesses most impacted by Omicron across the UK
David Baxendale, restructuring partner at PwC, said:
“The festive period is so vital for revenues in the hospitality and leisure sector that some businesses are happy to be breaking even by the time December comes. The government has stepped in to help buffer the effects of the current climate. While £1bn is a huge amount, businesses will be acutely aware of how far this support will have to stretch, especially when compared with previous levels of financial aid. Given the spectrum of firms operating across these sectors - spanning theatres, museums, independent businesses and the outlets forming part of large chains - there is sure to be significant demand. The key will be minimising the lead time between these businesses applying for and receiving this support. Current cost pressures aren’t planning to take a break for the festive season.”
Zena Gridley, operational restructuring partner at PwC said:
“Logistics, stock, and staffing arrangements are still being significantly tested with the new Omicron variant, in particular with staff sickness levels being extremely high and are likely to be further stretched either side of the festive season. In that backdrop, any support is a major shot in the arm for these vital businesses. We’re already seeing high levels of activity among clients needing to review their cost bases and any activity in support functions or services not directly linked to customers.”
Claire Fox, retail operational restructuring partner at PwC, added:
“Trading costs from rents to employees to utilities - including energy bills - are still mounting up. For the bigger players, the balance between core, high cost but high revenue outlets in the city centres, which are experiencing lower footfall - or even the lesser performing outlets where revenues aren’t as strong - remains a key consideration. Across the board, maintaining the financial momentum needed to address inventory costs and run day-to-day operations while waiting for revenues to flow remains a key objective for survival.”
At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 156 countries with over 295,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at PwC.
PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see how we are structured for further details.
© 2021 PwC. All rights reserved