Gov discount scheme poses 'slippery slope' for sector

By Rebecca Weller contact

- Last updated on GMT

Demising margins: proposed Government campaign encouraging businesses to offer discounts to consumers poses a “slippery slope" (Credit: Getty/SolStock)
Demising margins: proposed Government campaign encouraging businesses to offer discounts to consumers poses a “slippery slope" (Credit: Getty/SolStock)

Related tags: Finance, Legislation, Government

A proposed Government campaign encouraging businesses to offer discounts to consumers without any financial backing poses a “slippery slope” amid demising margins, according to one Canterbury-based licensee.

This comes as recently appointed Cost-Of-Living Tsar and former chief executive of Just Eat, David Buttress, put forward the idea for the taxpayer funded drive, which is yet to be named, encouraging business to offer discounts in exchange for promotion as part of the campaign.

Licensee of the Dog at Wingham Marc Bridgen said: “Many operators are already considering doing deals to get people through the door, but when our margins are under such pressure, it’s the last thing we want to do. It’s a very fine line and a slippery slope.

“It depends what discount you need to give to get the advertising and how effective the advertising promotions are going to be.

Truly effective 

“On the whole, the Government aren't typically the best marketeers.”

The initiative, proposed in a bid to tackle the cost-of- living crisis, follows summer 2020’s Government funded Eat Out To Help Out scheme, however, Bridgen explained pubs are not in a financial position to fund a similar campaign alone this time.

He added: “Eat Out To Help Out was truly effective, but it was a big discount, and it could only work because the Government funded it.

“Having said that, we did continue Eat Out To Help Out and fund the discount ourselves for a period and it continued to be hugely beneficial.

Huge success 

“But the problem is, our margins aren't there at the moment. I don't think we can fund it to that degree again"

The Eat Out To Help Out scheme offered consumers a 50% discount on food or non-alcoholic drinks, up to a maximum of £10 discount per person, every Monday, Tuesday and Wednesday between 3 and 31 August 2020.

Bridgen added: “It was so joyous to have huge levels of people through the door last [time] but doing price driven offers is only really any good if you get huge amounts of volume.

“The better way to do it would be for the Government to do some promotion, like Eat Out To Help Out, but maybe not be so generous in the funding. Then between us we'll make it a huge success.”

Related topics: Legislation

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