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Ahead of the recent Autumn statement, many in the industry were calling for urgent and dramatic action to be taken with everything from a reduced VAT rate to a business rates holiday all requested from the new chancellor.
As much as these measures (and more) would have been welcome and in my opinion, deserved, we were all aware that every industry across the UK were putting over similar requests for assistance. As much as I have a passionate belief that the hospitality industry is unique and as such does require unique support (see my last opinion piece), I just couldn’t see us getting even a little of what we so desperately wanted.
And so it came to pass, an Autumn statement that, politics to one side, was disappointing for many SMEs. Aside from some support with transitional relief on business rates, there really was nothing there for our industry, or business in general. Much of the speech was used to outline the new government’s fiscal policy in general, political terms.
So now much of the industry feels very much that we’re on our own and as we enter a recession there are heightened fears that the pub industry is once again in the midst of a threat that it may not emerge from.
Perhaps, but perhaps not.
Is it a matter of thinning the herd but yet again, the fittest and more adaptable survive?
The pub industry is in decline, on that there can be no doubt, between 1990 and 2019 there was a fall of 26% in the number of pubs in the UK with the steepest point being from 2001. A 2014 report by the Institute of Economic Affairs (IEA) found that the reasons for the decline in pub numbers were due to 4 main reasons:
- Smoking ban
- Economic factors such as the 2008 recession
- Increased taxation
- Reduced alcohol consumption
As a pub operator myself in 2007/2008 I certainly felt the full effect of the smoking ban and recession on my business, but I was able to trade through the other side.
But having been in the industry for 30 years, I would argue the main reasons for pubs closing is simply that society has changed and too many pubs have been unable or unwilling to change too.
Around 20% of people in the UK are non-drinkers. Many of those and bound to see traditional pubs with drinking being their ‘point’ as not being for them.
As Wetherspoons are reportedly struggling and selling pubs off, there are regular announcements from more experiential bars that they are opening more and more sites. Whilst some of us do lament the losses of any smoky fireside, real ale darts and doms pubs, for others it simply isn’t for them.
I strongly believe that we will never lose the traditional British pub, but to assume that it will always remain the same forever, and in the same numbers is naive. This is not to say that traditional pubs are not those who are thriving, in many cases they are!
So, given the changes to society in general, what makes one pub thrive in tough times while another closes its door for good?
I would argue it is based around the business itself.
In 2007/2008 I had to fight for my very survival in my pub. It meant reinventing what I could offer and paying attention to every detail. Every detail of my pub and every detail of my business. Every penny had to be accounted for and every cost justified.
But the numbers are only one part of a pub business, we all know that there are certain basic standards that many pub businesses simply ignore:
- Cleanliness
- Quality of product
- Quality of service
Yes, bar and menu prices may well have to rise. But I’ve always said that if price were the only reason people drank or ate, we’d all be guzzling cheap cider and eating Aldi pasta. We’re not, but we are all aware that our money can only go so far so we’re not going to waste it in a pub that serves poor drinks at dirty tables with a surly bartender.
We then turn to the business itself. Given what Roslyns do as specialist business services providers to hospitality businesses, we’re uniquely place to see the good and bad of pub businesses’ practises. It is not coincidence that those of our clients doing the best are the ones who focus on their business, speak with us regularly about their figures and embrace the advice, tools and recommendations we offer.
So, is the sky falling in? Are we all doomed? No. It will be hard as hell and hard-working pub professionals are going to be working even harder to get through this next challenge. But the help is there. It is time to embrace that support and adapt to survive. Look at your business with dispassionate eyes and ask what can I do better, and who can help me do it?
Business is often a fight for survival, not with the government, but with the competition!
As the old saying goes,
I don’t need to outrun the lion; I just need to outrun you.