The Brief: British pubs are capitalizing on the FIFA World Cup’s hype as owners expect more customers to come in, according to Bloomberg. The report states that many of these establishments are already fully booked, hoping to recover from a huge decline in footfall in 2019. The cost-of-living pressure, however, is cited as one factor causing many to stay at home instead of heading to pubs to watch the matches.
Why It Matters: Pub owners remain optimistic following Jeremy Hunt’s Autumn Statement. The British Beer Pub Association (BBPA), which represents 90% of beer brewers in the country today, was pleased to hear about the increased relief to 75% for pubs to avoid unfair taxation. However, it’s still concerned with higher operational costs that surged 22% from last year, and the closure of about 50 pubs a month. Pub operators Mitchells & Butlers expect their total costs to rise by 11.5% this year.
Finanze Business Foresights: Data from the BBPA indicate a downward trend in the total number of pubs in the country since 2000. In 2021, there were 46,350 pubs in operation, down 46,800 from the previous year. In June 2022, only 39,970 are said to be in operation. Energy costs and a drop in demand will continue to drive these numbers lower if these small enterprises cannot negotiate new energy contracts, especially as we head into winter. Sunak’s relief, however, doesn’t guarantee that many of these businesses will be out of the red after the World Cup ends. This does not only affect the pub sector, but the entire hospitality industry that did not hear anything about a VAT cut during the Autumn Statement. With the government’s pandemic loan schemes having ended, financial support for these businesses is more crucial than ever in order to sustain their operations and keep staff employed.
To the fullest extent permitted by law, Finanze Business Ltd are not responsible for any errors or omissions in any statements, views, opinions, facts, figures, commentary or any other material in the articles contained herein, or for loss arising from its use or performance, or for the results of any actions or lack of action taken on the basis of information provided in articles.
The topics covered in articles are complex and do not substitute the need for financial, legal, accounting, tax and other advice before making any decisions or taking any action based on information in articles.