The number of pub and bar insolvencies in the UK rose by nearly a third in the past year as drinkers cut their spending.
Pub and bar insolvencies climbed by 30% to 784 in the year ending 30 April 2024, up from 602 insolvencies in 2022/2023, data from accountancy group UHY Hacker Young revealed.
UHY attributed the rise in solvencies to high prices for drinks in the on-trade, with consumers limiting their spend due to the cost-of-living crisis.
Peter Kubik, partner at UHY Hacker Young, said: “With money tight for many households, current alcohol prices mean more people are choosing to drink at home instead of going out. The pub and bar industry has struggled for a long time but the past two years have been particularly difficult.”
Citing data from UK alcohol charity Drinkaware, UHY noted that 26% of people aged between 16 and 24 abstain from drinking.
“The young in particular are drifting away from drinking after work or at the weekends, impacting pubs and bars,” Kubik added. “The demographic trends for pubs and bars in the long term are very concerning.”
He added that the new Labour government, led by prime minister Keir Starmer, must “overhaul the current rate system” to support the sector.
Kubik continued: “After a year of rising insolvencies, pubs and bars are hoping that the boost of the Euros [football tournament] will mean a stronger summer of trading. That’s only likely to be transitory, however.”
Euro 2024 drives drink sales
CGA by NIQ’s Daily Drinks Tracker recently reported that drink sales in Britain’s hospitality chains rose by 6% in the seven days to Saturday 29 June, boosted by England’s final group stage game at Euro 2024 on Tuesday (25 June). On that day, drink sales soared by 71% compared with the same day in 2023.
Warm weather also helped sales grow between 7% and 8% on Sunday, Monday and Wednesday (23, 24 and 26 June). However, trading was down on Thursday, Friday and Saturday.
There were double-digit gains for beer (up 11%) and cider (up 18%) across the week, while spirits dropped by 6% and wine dipped by 1%.
Meanwhile, sales of no- and low-alcohol ‘spirits’ have also increased by 20% since the start of Euro 2024, according to online supermarket Ocado.
Trade body UKHospitality estimates that the Euros could provide a £800 million (US$1 billion) boost to pubs and bars in the UK if England is crowned champion.
