Energy costs could cripple pubs
Pub operators are struggling to absorb huge hikes in energy prices, which could cost many pubs an extra £100 or more per week.
Operators fear customers won't be prepared to pay what could amount to an extra 10p on a pint after recent brewery price increases are factored in.
Derek Andrew, MD of the 550-strong Pathfinder Pubs managed division of Wolverhampton & Dudley, told the Morning Advertiser:
"These are the most severe cost increases from anything that I've experienced in my 25 years in the trade. And it has happened so suddenly.
"It is fanciful to think that we can get back the increases from customers - as an industry we just have to grin and bear it."
Pass on costsBarracuda's energy supply contracts are due for renewal this year. The market is so competitive that it would be commercial suicide to pass the increases on to customersJim Sloan, St Austell Brewery
Chief executive Mark McQuater said: "I don't think we, like most operators, can directly pass on energy increases on to customers ; you've just got to run your business better."
St Austell Brewery is bracing itself for a 15% to 20% increase in its electricity bills when the contract is renewed later this year.
Retail manager Jim Sloan said: "The market is so competitive that it would be commercial suicide to pass the increases on to customers. Instead, we will be focusing on energy efficiency."
Price hikesHowever, other pubcos said it was almost inevitable that customers would have to pay more.
Chameleon Pub Company boss Phil Strong said his five-year supply contract had just ended and energy prices under the new contract had risen from 1.08p to 2.8p per unit.
Strong explained: "It will probably mean an extra £100 per week for each pub".
For more on this story and an in depth look at how you can save money by cutting your energy costs see this week's Morning Advertiser.
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