'Crucial role of pubs getting lost'

With the fundamentals of running a business constantly changing due to cost pressures across the board, operators continue to face “big challenges”, Price said, resulting in the reasons why pubs are so important becoming “lost”.

The managing director explained rising energy and labour costs teamed with food inflation and price through the supply chain shifting upward, firms were left between a “rock and hard place”, with no choice but to pass on these increases to cash-strapped guests.

He continued: “The pub plays such a crucial role and that’s the bit getting lost in all this, what a great thing that the Great British pub is and how that's worth protecting.

Squeezed margins 

“There are so many factors all combining at the same time, it is making it hard. Margins are squeezed and we don't want to see more business failures.”

Moreover, Price added if operators calculate their prices wrong, they were “doomed” in the current economic climate.

“I've been setting prices for the business for 23 years and you kind of know where you expect them to be, but this last year or so, you've been thinking well, normally I would have put 25p on that, but now is it £1, £2, is that enough?

“That’s not very comfortable when you're pushing beyond what you feel is right, but the margins in the business and the numbers on the page are telling you have to”, he said.

"There's an argument to say we've been undervalued for a long time"

This comes as data from Fourth recently showed venues had been forced to hike their prices by an average of 7.1%​ in the year to December 2023, while food inflation​ was estimated to have stood at 15% in November last year and pint prices jumped 10%​ during this time.

In addition, the headline rate of inflation​ was recently estimated to have risen to 4% in the 12-months to December last year by the Office for National Statics and interest rates frozen at 5.25%​ by the Bank of England earlier this month.

Moreover, 803 licensed venues closed​ in the fourth quarter of 2023, according to data from the latest Hospitality Market Monitor from CGA by NIQ.

“There’s definitely been a re-education for the customer in terms of what things cost and what we'll have to charge for things.

“There's an argument to say we've been undervalued for a long time, but it feels like we need some help somewhere from the Government, but we're unlikely to get it, I think”, Price added.

Big changes 

Ahead of the Spring Statement​, due to take place on 6 March, Price urged the Government to cut VAT prices for the sector and implement an “absolute root and branch reform” to business rates to help ease pressure.

He continued: “Those are the two big changes we really need, they are terrible, the whole business model [for hospitality] has been shifted.
“We've always been highly taxed, but you can't keep taking from something that’s got nothing to give when those margins aren't there.

“When Rishi Sunak was chancellor, he did quite a lot for us in Covid times and it seems since he's been Prime Minister that's all been forgotten. We're all hoping something will change, but it may need a change of Government to get there.”