Pubs raise alarm over costs crisis as many cut hours to lower spend

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UK pub associations have called on the government to help save the sector as new research reveals that hospitality venues across the country have slashed their operating hours over the past three months in an effort to reduce their energy spend.

New analysis by the Office of National Statistics (ONS) showed that four per cent of businesses have cut trading by one day a week in the past three months.

About six per cent of businesses in the sector intend to stop trading for an extra two or more days a week in the month to try and reduce their energy costs, with the same proportion of businesses saying they had already taken this action in the last few months.

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The ONS business insights and conditions survey found that this group of operators are the most likely to reduce trading hours, with 21% of respondents saying they would do so even if they were still operating for the same number of days.

One in ten businesses across the hospitality sector said they had reduced or simplified their offering of goods and services, or were planning to, in a bid to offset rising energy costs.

Trade body the British Beer and Pub Association (BBPA) said: “New ONS stats lay bare the vulnerability of pubs and brewers regarding energy costs and the tough decisions they [are] having to make to survive. We need clarity and a long-term guarantee on business energy support beyond initial six months in Jeremy Hunt’s Thursday statement.”

CAMRA chair Nik Antona said: “It’s deeply concerning, but unfortunately no surprise that the ONS report energy prices as the main concern for three out of five hospitality businesses in November, even with the government’s Energy Bills Support Scheme in place.

“The steps that these vital community hubs will be forced to take, such as cutting trading days or hours, offering a more limited selection of products, increasing prices, or even taking the difficult decision to let some staff go, are all sure signs that the government needs to act now.”

The hospitality sector was the most likely to consider raising their prices in November as a result rising energy costs, with the research showing that manufacturers were also feeling the pinch over energy prices.

About two in five businesses in the hospitality sector (41%) said they expected their prices to increase this month.

Sector businesses were also vocal about predicting lower turnover for November, with 46% expecting this to be the case, more than double the average of 21% based on responses from all other business groups.

Steve Alton, CEO of the British Institute of Innkeeping, which has written to the Chancellor and Prime Minister urging them to invest in the sector, said: “Times have never been tougher for our members and the wider hospitality industry, but the resilience they have shown over the past three years has demonstrated the immense appetite for the experience that they deliver, one that cannot be replicated anywhere else.

“Whilst they face huge challenges with rising energy costs and double-digit inflation across all areas of their businesses, they also have the power to be a key part of the economic recovery, providing thousands of jobs and career opportunities like no other sector can.”

The BBPA has also made a final plea in an open letter to the Chancellor, asking him to reconsider a freeze to beer duty to help keep the cost of a pint in local pubs affordable for customers this Christmas.

Emma McClarkin, chief executive of the BBPA, said: “We are caught in an extremely vicious circle, customers are understandably being cautious, but the cost of doing business is out of control and as a result this is set to be the toughest Christmas on memory for UK pubs and brewers. Many just managed to pull through the pandemic, but what we are facing now is crippling businesses at an unprecedented rate.”

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Joshua Walton

The author Joshua Walton

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