Another popular cafe and bakery has decided to close due to the rising cost of doing business.
In a statement, Richard Wilson, the managing director of Abbotts and Kinney, thanked the community for their support. The company’s lease on its store in Croydon was set to end.
Due to the increasing cost of doing business, he said that the company’s time has come to an end.
He thanked the customers for their support over the years. However, he noted that many businesses are forced to make difficult decisions due to the current economic situation.
According to CreditorWatch, the hospitality industry is most vulnerable to the effects of the current economic conditions.
It noted that over 7 percent of the hospitality industry could fail in the next year.
Consumers are being restrained by higher costs of living, which is why they are less inclined to spend.
Other factors such as food and labor shortages are also affecting the industry.
Anneke Thompson, an economist for CreditorWatch, said that a small decline in consumer spending in the food, restaurant, and cafe sectors could compound the difficulties faced by these businesses.
She noted that the insolvency rate for this industry would keep rising as long as the interest rate remained at its current level.
According to Patrick Coghlan, the chief executive officer of CreditorWatch, the conditions for the hospitality industry are expected to get worse before they get better.
He noted that the industry would not improve until the effects of rate cuts start filtering through to consumers.
Despite the company’s popularity, Abbotts and Kinney’s announcement is another example of how businesses are forced to change their operating model due to the current economic conditions.