A Walsall pub licensee has offered an eye-browsing raising insight into the plight of pubs up and down the country.
With less people venturing out due to COVID restrictions over the last couple of years, it’s been tough enough for licensees. However, even with customers back in pubs, they are now facing high energy prices and increased costs from suppliers and breweries.
Posting on Facebook, the landlord of the Sir Robert Peel in Bloxwich revealed that they’re stepping away from the pub and say that they’ve been “priced out of making a living”.
Walsall Landlord Discusses Rising Prices
“Unfortunately the powers above me have become extra greedy and with the governments new alcohol and utility rises and the brewery increasing their charges in April we have basically been priced out of making a living,” reads the post.
The post goes on to explain that they would need be charging £4.50/£5 pint to hit the same gross profit as they were six weeks ago in an area of the country where residents simply won’t pay those prices, when they can nip to the nearby Wetherspoons for a much cheaper pint at a time when counting the pennies is becoming even more crucial.
To put the costs into context, the Sir Robert Peel licensee gives the following explanation, offering an insight into the financial pressures of running a pub:
“The cost of just holding the keys is £2255 per week, rent, electric, gas and water and waste management but that’s without having a drop of alcohol in the building and without any staff,
Add 2 full time staff and 10 barrels of draught products and you’re not far off 4 grand, A WEEK!
and still, the fridges are empty, no pop, bottles or BIBs and you don’t have a bottle of spirits in the building,
You’ve stocked up, now you’re close to 7k in the red and don’t have a customer yet or sold a drink
Now you’ve done everything as you should with this new pricing malarkey and you’re ready to open, you can’t charge £5 a pint because we live in Bloxwich and you’ll get laughed at, so let’s assume you’re happy with making 30% GP on barrels, take in to account spirits are around 70% GP which brings your overall to around 40% GP overall given the ratio split of high and low GP Stock, you have about 5k in stock, so if, AND THIS IS A MASSIVE IF…
You sold absolutely every drop you had, you’d have £7000, but you started the week by putting out 7k, oh. And don’t forget the tax liability you need to save for your staff, and you best keep that 20% from your wet sales because the vat man will want his share too, payroll and accountant services are also due,so now you’ve worked 40+ hours yourself, kept the machine well oiled everyone’s been paid, bills are paid but now you can’t replace the stock you have sold and have earned absolutely ZERO income for yourself, and about £800 in debt after 7 days and a 7 grand outlay.
What happens to your rent/mortgage, cars/travel, shopping, kids, life?
Also £7000 is £1000 a day, to make £1000 a day you’d have to sell on overage 285 pints a day, over a solid 9 hour period that’s a pint every 2 minutes .
WELCOME TO OUR REALITY.”
Prior to leaving the Sir Robert Peel for good and handing over the keys, the licensees have decided to close Monday-Thursday as they reassess their future, which doesn’t look likely to be in the pub trade.