Scotland’s Pubs and Bars face ‘a Tidal Wave of Economic Challenges’ as Sector Calls for Urgent Support

The (SLTA) Scottish Licensed Trade Association today releases a snapshot survey of the challenges facing Scotland’s pubs and bars.

The post-Christmas/New Year survey, which covers the full spectrum of hospitality business including restaurants, bars and hotels, contains key insights into the significant impacts of a tide of unprecedented challenges with huge increases in the cost of energy, rates and post-Brexit challenges in recruitment.

Colin Wilkinson, SLTA managing director, said: “Our snapshot survey covers all types of licensed premises and is an indicator of the key issues facing the wide range of small to large businesses which trade within the wider hospitality sector.

“Our survey is based upon quantitative research from outlets covering the length and breadth of the country and is supported by major food and drink chains and independent pubs, bars and hotels in Scotland’s hospitality sector.

“As we enter the second month of 2023, three out of five outlets are operating restricted hours with rising costs, staff shortages and enormous increases in energy prices – 45% of our respondents reported energy increases of over 250%.

“Our members are also concerned about the impact of Scotland’s deposit return scheme (DRS) and the proposed restrictions on alcohol advertising sponsorship which will impact on many everyday aspects of pub life – from sponsoring the dominos team to serving local beers in branded glasses.”

Mr Wilkinson warned: “We previously warned that it wouldn’t be economically viable for many outlets to remain open and we are now seeing this come to fruition with a knock-on impact on tourism and Scotland’s wider food and drink sector, including the supply chain.

“Christmas/New Year 2022 was the first time since 2019 that our pubs and bars were fully open without Covid restrictions, but the feedback in our survey shows that half of outlets were still in decline versus the last ‘normal’ festive season trading period.

“Adding in increases in rates, operating costs, staff shortages and uncertainty on energy, we urgently call on local and national governments to help our sector, and the associated jobs in the wholesaling, brewing/distilling and food-producing sectors.”

Executive summary of key challenges

• 50% outlets were down Christmas/New Year 2022 versus the last ‘normal’ festive season.

• Costs are rising massively: 45% are facing energy rises of over 250% and 40% of outlets are facing added costs via rateable value increases.

• 60% of outlets are closing early or for full days and won’t be operating to their full opening hours in Q1.

• 40% of outlets had to restrict opening as they still face post Brexit staffing issues.

• Outlets face further legislative challenges on Scotland’s deposit return scheme (DRS) and proposed changes to alcohol advertising and promotion.

• Government support is urgently needed, with 76% of outlets requesting Government support to survive in 2023 – this is a slight decrease from 86% in September.