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Declines Of The British Pub Slowing?

In September, the British Beer & Pub Association released information regarding pub closures in the UK.

Back in the 1970s more than 90% of all beer consumed in Britain was bought from the “on trade” — pubs and clubs.

According to the British Beer & Pub Association this ratio had fallen to 51% from pubs and 49% from supermarkets at the end of last year. “It will cross over in the near future,” said a spokesman, possibly as soon as this Christmas.

This would be a watershed moment for Britain’s beer industry, a culmination of long-standing change in consumers’ drinking habits as well as confirmation that the recession has caused people to stay at home more.

The figure came as a report from the GMB union highlighted how the high price of beer has caused the destruction of thousands of neighborhood pubs, in turn damaging many working class communities. It said that local pubs, many of which had survived the Blitz and the great depression of the 1930s, were now being destroyed by the recession.

Pub closures hit a record rate of 53 a week at the height of the recession. Last year, 26 a week closed their doors, leaving just 52,500 pubs in Britain, nearly half of the level at its peak before the World War II.

The Beer & Pub Association blamed competition from the supermarkets, which often sell beer as a “loss leader” to drive customers into their stores, and above-inflation increases to beer duty. The GMB blamed large pub companies putting up their prices because they were struggling with too many debts.

Last week, they released a new statement, Sticking to the facts on pub closure numbers, which said, in part:

The BBPA has moved to set the record straight over conflicting analysis in recent days of UK pub closure figures. It is absolutely clear from CGA data, says the BBPA, that free trade pubs have been closing at a much faster rate that tenanted and leased pubs in recent years. The BBPA has published its full analysis of the data on its website, today available from the link below.

From January 2009 to June this year, CGA figures show 3,444 free trade pubs closed, compared with 2,239 tenanted and leased pubs over the same period. As the free trade sector has considerably fewer pubs, their closure rate over the period was almost double that of the tenanted and leased sector, at 16 per cent, as compared with 8 per cent. Taking new openings into account, there was a 9 per cent net reduction in free houses, compared with a 6 per cent reduction in tenanted and leased.

Free trade closures are higher, despite the considerable numbers of pubs being sold into the free trade from the tenanted sector. The reason that there are more free-trade pubs now than there were at the start of 2009 is that companies have sold tenanted/leased pubs to private owners, where this has been deemed appropriate.

“Pub closures are caused by a huge range of issues — the greatest of which we can influence are undoubtedly punitive rates of taxation and the high cost of regulation. And though there is still some way to go to halt the decline, we should all welcome that the latest figures show that the net closure rate has fallen significantly.”

Still, net closures are 14 per week. That’s two a day! But really, it’s 28 pubs closing each week or four a day, which is even more alarming. I’ve been told by Brit friends who know more about this than I do that it’s the bad pubs that are closing, but I have a hard time believing that’s all it is. With that many closing, there must be some good ones, or at least just average ones, that can’t survive as well.

Overall closures are declining since their all-time high (or low) in 2008, as are openings as well, so you can see why there is some reason for optimism. When things are going poorly, you tend to focus on whatever positives you can. Everyone who was involved in craft beer in the mid-1990s will know what I mean. But I’d still be more pleased if the British pub was to regain its footing by opening more pubs than are closing.

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