Pub industry is cheered by rising sales... of soft drinks

‘Driving laws have had an impact’

CUSTOMERS are giving up pints for soft drinks because of Scotland’s tough drink-driving laws.

Pub bosses say the industry is starting to show some recovery from a ’perfect storm’ of new alcohol laws for motorists, high business rates and increases in the minimum wage.

Since the lower drink-driving limits were introduced in 2014, 4,000 pubs have shut in Scotland – but owners are now seeing cautious signs for optimism.

Figures released by the Scottish Licensed Trade Association (SLTA) show 35 per cent of pubs and bars reported a drop in beer sales in the last year.

However, the same survey of 600 retailers also found that 80 per cent of outlets reported sales of soft drinks are up.

But despite the more positive outlook for the industry, business leaders warned that the threat of higher business rates is a major concern. SLTA president John Shearer, the owner of two hotels in Tain, ross-shire, said: ‘The changing of the drinkdriving laws is a big issue for pub owners. The market is adapting but it isn’t easy.

‘The whole culture of the industry has changed. Owners are even unsure of when the best time is to open.

‘For example, people are no longer drinking on a Sunday evening because they are worried they might be over the limit the next morning, so lots of pubs are simply closing.

‘The same thing goes for week days. A pub closing on a Sunday is something that would have been unheard of just a few years ago.

‘The drink-driving laws have had a major impact, especially in rural areas and come as part of a perfect storm with increased wages for staff, the fact banks aren’t lending and increased business rates.’

The figures show nearly half of pubs, hotels or bars saw a growth in sales and 74 per cent reported business as ‘stable’.

The figure is up on the previous year when just 39 per cent reported an increase in sales and just over half, 58 per cent, were ‘stable’. The overall rise marks a turning point after years of decline but figures show that 36 per cent of rural pubs are still in decline.

Mr Shearer added: ‘The weaker pound and cheap air fares and hotel rooms mean that more tourists are coming to Scotland for whisky tours, which seem to be big business.’

Colin Wilkinson, managing director of the SLTA, added: ‘After a number of years of decline and from a very low base, we are now seeing some improvement with 49 per cent of respondents seeing growth.

‘However, there are concerns, particularly in rural outlets, where pubs are often key to the community.

‘Government legislation is still a big concern, with 63 per cent highlighting these areas, alongside business rates and increasing labour costs.’

Sales of craft beer increased by 80 per cent this year and sales of single malt whisky and gin also rose slightly.

The survey was carried out by auditors KPMG. Alistair McAlinden, head of hospitality and leisure for KPMG in Scotland, said: ‘It is clear that cautious optimism is building within the sector.’

A Scottish Government spokesman said: ‘We provide the most competitive system of rates relief in the UK, worth around £720million, including the Small Business Bonus Scheme which lifts 100,000 properties out of rates altogether, as well as targeted support through rural relief and a Transitional rates relief Scheme, both of which reduce the cost facing licensed trade, particularly in rural areas.’