Pub profits down 15% since smoke ban

By Graham Ridout

- Last updated on GMT

Related tags: Profit, Wales, England

Pub profits down 15% since smoke ban
The dire financial state of many pubs is revealed in a survey of 500 tenants carried out by the MA. The most startling statistic is that 10% of pubs...

The dire financial state of many pubs is revealed in a survey of 500 tenants carried out by the MA.

The most startling statistic is that 10% of pubs are operating at a loss or zero profit.

Also, as many as 78,000 full and part-time jobs may have been lost if the survey results replicate the situation across the 50,000 pubs in England and Wales.

The survey found the average profitability of a pub had slumping by almost 15% in the past year to £24,180.

Of equal concern is that more than half of survey respondents (54%) predicted profitability falling even farther over the coming year.

The average pub turnover has only dipped by 1.9%, but a significant number (9%) reported drops of more than £100,000, many of which were in the £300,000 to £400,000 turnover bracket.

Nearly six out of 10 pubs (57%) had been forced to shed staff, with an average of 2.75 redundancies per pub.

The smoking ban was cited as having the biggest impact on business: three times as many licensees (57%) blaming the ban for lost trade as those citing consumer-spending slowdown as the key factor (19%).

Pubs where trade was down reported falls ranging between 5% and 40% with the average drop being 18%.

Pubs that benefited from the ban reported trade was up within a range of 2% to 20% with an average of just less than an 8% increase.

The figures indicate that claims about pubs being repatriated by non-smokers after the ban were over-optimistic. Despite the hardening financial climate, licensees reported little assistance from their pubcos, with 59% citing them as "unhelpful"​.

The areas where hosts wanted help from pubcos were: better discounts on products (53%); rent reviews (29%) and interior or exterior pub revamps (19%).

Two-thirds also said their BDM was "not at all creative" in helping them build business.

Related topics: Legislation

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