James Anderson, a partner at licensing lawyers Poppleston Allen, on the future of pubs in 2022 the impact of inflation and where they can expect to make gains.
Q&A
Following on from last year, what predictions can be made about the pub trade, and where will it be at the end of 2022?
“Difficult to predict with certainty. There seems to be considerable optimism, particularly at the premium end of the market, also, in more affluent ‘London villages’ and suburbs. And, indeed, those pubs with rooms have done well, with more people working from home, staying in the UK to holiday.
“There are areas in the economy which are a threat, such as the considerable increase in inflation (currently over 5%) and this may impact on the leisure industry with the night out and the restaurant meal being sacrificed to save cash.”
Where are pubs losing out the most?
“There are a number of challenges, including not just staffing costs but the availability of staff. This is particularly felt in the chef/kitchen area, where there is a significant shortage, but also across the board. The industry is pressing for business rates cuts and a significant reduction in VAT to assist.
“There has been a significant premiumisation in the market, with pubs offering what cannot be consumed at home, such as a convivial atmosphere, premium ales, wine, and cocktails. Customers are becoming more discerning and, therefore, quality, good service, and staff knowledge are becoming increasingly important.
“Certainly, pubs are looking at other areas and there has always been a strong link with sport. The Six Nations is coming up and many pubs do well with football and other competitions.”
Q. What could the new lifting of working from home restrictions and general lockdown measures mean for the pub trade?
Mr Anderson said: “It will hopefully have a significant impact on the towns and cities, for example, central London, which has been badly hit by workers not coming in. These pubs have lost a lot of trade and indeed some have not re-opened.
“In terms of general lockdown, hopefully there will be greater confidence, which was badly affected in December, and turn January, normally a particularly quiet month, into a livelier one.”
• James Anderson is a partner at licensing lawyers Poppleston Allen.
