The chief executive of Wetherspoon has announced that the popular pub chain will not be raising prices on their food and beverages in the upcoming months. This decision follows a previous price increase of up to 30p on certain drinks and meal deals back in January. Sir Tim Martin, speaking to The Sun, stated that they plan to maintain current prices at least through the summer and autumn.
In addition to this pricing strategy, Sir Tim criticized the tax regulations imposed on pubs. While pubs and restaurants are subject to a standard 20% VAT on their food and drink sales, supermarkets are not required to pay VAT on similar items. He emphasized the importance of tax equality between pubs and supermarkets.
Wetherspoon also disclosed their intentions to open 30 new pubs in the next year, which will result in the creation of 1,800 jobs. Half of these new establishments will be directly managed by Wetherspoons, with the remaining half operated by franchisees. Among the 15 pubs that will be directly managed are locations in Edinburgh Old Town, Farnham in Surrey, Basildon in Essex, Manchester, Heathrow and Gatwick Airports, London Bridge and Paddington in London, and Glasgow.
The pub chain currently operates 794 pubs, with three new openings and nine sales in the past year. This represents a decrease from their peak of 955 sites in 2015. Recent financial reports show a 5.1% increase in sales for Wetherspoon in the three months leading up to July 20 compared to the same period last year. The company noted that sales volume has exceeded pre-pandemic levels.
Despite the challenges posed by increased labor costs due to higher National Insurance contributions and minimum wage rates, Wetherspoon remains optimistic about meeting its profit projections for the year. The company expects to face a £60 million impact from these rising business costs. Notably, Guinness has been highlighted as a top performer in boosting sales, alongside increased demand for breakfast offerings.
Julie Palmer, a partner at business advisory firm Begbies Traynor, commented on the industry landscape, noting that while many pubs are at risk of closure, Wetherspoon’s size and financial discipline may shield it from the pressures affecting independent operators. She suggested that the future of pubs may require a strong focus on unique offerings to attract customers or the development of well-established chains like Wetherspoon.