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Wednesday, 22 July 2009

How to kill an industry

  1. Kill demand for its products
  2. Tax it
  3. Regulate it

Which is exactly what has happened to the British pub. Two years ago pubs were closing at the rate of 2 a week. Last year it was 27 a week and this year it is 52 a week. Given that businesses do not go belly up overnight (although the recession is clearly a factor), this decline has its roots in changes that have happened over the last 5 years.

In that time there has been:

  1. A ban on smoking in enclosed public places (although a pub is a private premises)
  2. A 35% increase in tax on a pint of beer
  3. A new Licensing Act that limits licensed entertainment

You know who to blame if your favourite pub closes.


Not a sheep said...

Good spot and well said. This government's knee-jerk reaction to over-regulate (in the wrong places) and over-tax has a lot to answer for.

Demetrius said...

There is also the issue about how pubs are no longer pubs but property investment opportunities that can create a cash flow to be maximised and used as a basis for leverage. This has affected prices and the nature of pubs. So after 50 years of devoted pub going, I now drink at home.

Alex said...

I don't really buy that line. The brewing / pub industry was in a little back water of its own making, but when big international firms started forming it was inevitable that there would be some restructuring and realignment of assets and brands.

A good pub is still a good pub, even though we may all have different tastes and views about which pubs are the "good" ones.

Real Ale Blog said...

"You know who to blame if your favourite pub closes."

I think the word blame is key here. It's easy to do. Yes we are in a recession, money is tight therefore businesses will go bust. Rather than blame a good business will adapt A lot of pubs still leave a lot to be desired. There are some really fantastic pubs out there that are busy on a regular basis but there are still too many not willing to raise their game!

Alex said...

"Money is tight therefore businesses will go bust."

True, but 95% of those that do go bust are drinking only estalishments. Pubs that sell a lot of food aren't failing as much. If what you want is an honest to goodness pub, its business model may have been killed off.