Christmas bookings for UK pubs and bars have surged this year thanks to a jump in office parties and family gatherings, marking a bright spot ahead what could prove a brutal new year.
Greene King said festive bookings had risen above 2019 levels, before the Covid-19 pandemic wreaked havoc on the industry, climbing 12 per cent year on year and with significant growth on Christmas Day and Boxing Day.
“Customers are definitely planning to come out at Christmas,” said chief operating officer Clair Preston-Beer, adding that food-led party bookings had increased, both for office parties and gatherings of friends and family, with a growing number of guests enjoying games such as digital darts too.
All Bar One owner Mitchells & Butlers said its own bookings were up 9 per cent year on year, while Young’s reported a 30 per cent jump in festive bookings this year.
But it may be the last Christmas for some operators, industry figures warned.
After lurching from a global pandemic into a period of staff shortages and soaring input costs, pubs and bars now face sharp increases in taxes following chancellor Rachel Reeves’ Budget in October, leading to potential closures in the next year.
“2025 is going to be a tough year for pubs because of the layering of the costs coming our way . . . It is likely that we will see more pub closures,” said Preston-Beer, who expects £20mn in extra costs starting next year due to an increase in employers’ national insurance contributions from April.
“[Now] is the calm before the storm,” said Saxon Moseley, head of leisure and hospitality at RSM UK. “The tax increases are next year’s problem. Operators are really keen to make the most of this festive trade . . . They need to fill their war chests [and for this to be] a good Christmas.”
High costs are already weighing on operators, with some 1,200 pubs likely to shut their doors this year on current trends, according to the Campaign for Real Ale, compared with about 1,000 in 2023 and just over 800 in 2022.
Chris Jowsey, chief executive of Admiral Taverns, said an increase in employers’ national insurance contributions and a rise in the minimum wage came as a “big shock” for the industry. “Some pubs will be open for fewer days and fewer hours,” he said, recalling the height of the energy crisis, when many Admiral pub operators chose to close on Mondays or Tuesdays to save costs.
The Budget also included cuts to previous rate relief for the hospitality and retail sectors, while the government’s flagship employment reforms, which include protection against unfair dismissal from day one of employment, will also kick in by 2026.
Fuller’s chief executive Simon Emeny said the pub chain had been forced to scale back investment plans next year to about £30mn, half of this year’s planned £60mn injection, due to Budget measures, which he said would cost the company an extra £8mn per year.
“Any acquisitions now have to be under review,” he said, adding: “We will try very hard not to shed jobs.”
“For many within our sector it’s not about whether they can grow or not [but] whether they can survive or not,” said Charlie Gilkes, chief executive of Inception Group, which runs Mr Fogg’s bars. The group now plans to open just one site next year instead of three.
Companies are expected to raise prices to offset higher costs, with UKHospitality estimating its members would have to raise prices by up to 8 per cent to cover their extra costs. That would be another squeeze on punters, who were forced to contend with soaring prices for goods in the wake of the pandemic.
The average price of a pint of lager is now £4.80, an increase of nearly 30 per cent since before the pandemic, according to the Office for National Statistics.
Peter Wells, chief executive of Wells & Co, a Bedford-based brewer and pub operator, said: “People will be spending less,” adding that he had seen a decline in footfall in the weeks running up to the Budget as the government had warned of massive tax increases.
“We’re a pretty quick barometer to test the temperature of how the UK is feeling,” added Wells, who has cancelled a planned takeover deal in the UK as a result of the Budget.
Publicans are hoping that December will be a bright spot on a clouded horizon, although the worry over a shortage of popular stout Guinness looms. Pubs nationwide are expecting 234mn visits across the month — up 10 per cent from a year ago, according to industry intelligence Meaningful Vision. The footfall has steadily increased since December 2021’s 168mn, according to its data.
“In short, people can’t see where the growth will come from,” said Admiral’s Jowsey, who expects the two weeks from December 20 to deliver strong sales. “Christmas could be a welcome diversion from the worries of 2025.”
In order to withstand those challenges, pubs are adapting to new consumer trends.
“The Euros has taught us that consumers want to come out for key occasions, and they’re not trading down,” Young’s chief executive Simon Dodd said, adding that premium brands such as Estrella, Peroni and Guinness were the three biggest selling drinks during the tournament. “We’re very confident about Christmas,” he said.
Greene King’s Preston-Beer agreed that consumers were spending on big occasions, but with many still hit by the high cost of living “there is definitely a challenge to how many times they can do that”.
The rise of no and low-alcohol has also been a key trend this year, with office workers also opting for alcohol-free options at Christmas parties. Punch Pubs, whose Christmas bookings “are well ahead of last year”, said the total number of serves of such drinks across its estate rose by 55 per cent this year compared with last year. Emeny from Fuller’s said no and low-alcohol had become its fastest-growing category, with sales up 84 per cent in the six months to September.
Gilkes, from Inception Group, which provides all of its five signature cocktails in a non-alcoholic version, said it was also seeing “increasing demand for those drinks at Christmas parties.”
In the short term, publicans are hoping that strong festive sales will add a boost. Justin Platt from Marston’s, whose bookings rose 12 per cent on Christmas Day, said: “We’re feeling very good . . . Believe it or not, we’ll serve more than a million pigs in blankets over the Christmas period.”
