The Government has been very focused on the costs to households, and that’s a big concern for everyone as well, but there’s been little focus on the impacts on business.
One operator I was speaking to recently said he had seen his quote for energy supply jump from £16,000 a year to £45,000. As he put it: “How is that sustainable for my business?”
It’s yet another kick in the ribs for a sector that is desperately trying to get back on its feet after years of restrictions and half-baked Government directives, all of which have left the coffers bare, and given us little opportunity to trade effectively.
I’ve been reading lots of exchanges on social groups from desperate operators, all trying to seek out advice on how they can cut back on the bills, and it’s something we’ve written about as well and we’ll be giving some focus to this in next week’s Lock In podcast.
But the sad reality is, while we can fiddle around the edges, and cut a bit here and there, unless pubs are set to return to candlelight only, and only offer cold meals, we’re going to have to find ways to absorb and ultimately pass those costs on.
And we’ll be passing those costs onto consumers that are also feeling the pinch…
In a recent interview Lawson Mountstevens expressed optimism that pubs would remain an affordable treat, but with inflation rampant, how long will that remain the case?
The only possible salvation on the horizon would be tax reform – business rates desperately need to be addressed and holding VAT at 12.5% would also be a boost for food-led operators. If the Government were prepared to shift that to drinks as well, happy days, but I won’t be holding my breath.
The challenge we face is that we’re, yet again, asking for more from a Government that probably feels like it’s done enough for our sector - personally, I think they could do a hell of a lot more considering they were the architects of the situation - but sadly, my hotline to Boris doesn’t appear to be working.
This is probably a more pessimistic piece than I intended, but we can’t shy away from the reality – costs are escalating and we’re probably on our own when it comes to Government support.
That said, this is an industry that thrives on challenge and has demonstrated time and again, particularly during the pandemic, that is has the capability to adapt and survive when facing the harshest situations.
We faced a catastrophic loss of trade over the past two years, but we made it. We’re now facing a tidal wave of costs, but at least this time we’re open and trading. I’ve every faith in this sector and it’s abilities to thrive in the face of adversity.
So back to those barricades, and keep on fighting.