Pub operator Young’s has warned the controversial rise in employer NICs and the National Minimum Wage announced in the Budget will cost the company £11m next year, adding “we would like to see certainty and delivery of real business rate reform.” Until then, it seems, a number of pub operators continue to look at how they can accommodate the budgetary hikes in costs and rising inflation.
Young’s has warned measures announced in the recent Budget will impact company revenue by approximately£11m, as the group put forward plans to adapt staff strategy and explore new technology to avoid passing costs onto customers.
The company is one of several major UK pub operators concerned with the additional financial obligations that come into effect in April, with JD Wetherspoon predicting its bills could increase by £30m and Fuller’s claiming it will be forced to halve investment.
“The new Government’s Budget will result in significant increased costs for our industry in the near term through rises in national minimum wage and employers’ national insurance payments,”said CEO Simon Dodd. “We expect the cost impact to be approximately£11m on an annualised basis from next April.”
“We will work to see how we can mitigate these headwinds without passing on all the cost to our loyal customers. We would like to see certainty and delivery of real business rate reform which will benefit all hospitality businesses.”
Speaking to the Guardian, a spokesperson added that Young’s “would not pass on any costs to customers above its usual yearly price rise of 2 percent to 3 percent.”
“Instead the company would offset the impact of higher business costs by increasing sales and investments in its pubs, greater use of technology to maximise spend per head, and better deployment of staff during busy periods.”
Young’s was one of over200 hospitality operators that recently signed a joint letter to the Chancellor opposing the measures announced in the Budget,stating they could cause“unprecedented damage” to the industry, and cost businesses up to £3.4bn.
