I recently returned from a meeting with a company which operates in the hospitality industry. A good quality rural hotel with great food.
Like nearly all businesses in that sector it has not had an easy few years. The challenge of Covid was followed by hesitant consumer spending, a desire by people to go abroad to get some sun having been unable to do so for a couple of years and then huge inflationary pressure on wages, food and energy.
In rural areas the pub is often the last community asset. The bank branch goes from the local village followed by the nice bakery, the post office and frequently the school. The local pub becomes the remaining social hub, much more than just a place to have a drink.
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The business I met is cutting its costs and finding new ways to increase its revenues and it is making slow but steady progress. The increases in the minimum wage from April of 6.7 per cent for adults and a far larger percentage for young people, the increase in Employers’ National Insurance and reduction in support for Business Rates bills will cost that business several tens of thousands of pounds.
To put it another way it will cost it an amount roughly equal to its current profit. The business will have to cut costs, possibly jobs. It will have less capacity to invest, to grow and to deal with other knocks.
This is just one small example of the costs businesses have........