Fuller's hiked pint prices after staff costs soared
The boss of pub firm Fuller's has said the group hiked the price of a pint of beer by abut 15p across its bars after being hit with £8 million in extra staff costs.
Fuller, Smith & Turner chief executive Simon Emeny said the firm raised prices at the end of March in response to the Chancellor's tax raid in last October's Budget, which saw employers' national insurance contributions (NICs) increase from April.
In a double whammy for firms, they also faced another rise in the minimum wage from April, with pubs and hospitality companies among the worst hit.
Mr Emeny told the PA news agency that Fuller's has looked to be 'sensitive' with price increases, to 'make sure that going to the pub remains an affordable treat'.
He said the group would keep its pricing 'under review' over the rest of the year.
The group is the latest to raise the cost of a pint as pub chains look to offset soaring staff bills.
The British Beer and Pub Association (BBPA) recently said the average price of a pint of beer would surge past £5 for the first time because of cost hikes hitting the sector.
The BBPA said the average cost of a pint in the UK is expected to rise by about 21p as a result.
But Fuller's boss Emeny said the firm could not offset the cost impact with price increases alone.
The group, which has about 5,500 staff, is doubling down on investment in its bars and staff training, to drive sales higher, which it hopes will counter the extra costs.
'Six months down the line and I don't think price increases are the only answer. It has to come through higher sales,' he said.
But he said the consumer spending outlook would be sensitive to the interest rate outlook, and whether the Government moved to increase personal taxes.
The comments came as Fuller's posted a 32% jump in underlying pre-tax profits to £27 million for the year to March 29.
Like-for-like sales rose 5.2%, and the group said growth had continued into the first 10 weeks of the new financial year, albeit at a more muted rate of 4.2%.
It also announced that its chairman of 18 years, Michael Turner, a member of one of the three founding families, will retire at the group's annual general meeting in July, after a 47-year career with the group.
He will be replaced by Mr Emeny, who will become executive chairman, the first person to take the role who is not a member of the founding families.
Fred Turner will be promoted from retail director to chief operating officer.
A number of other founding family members remain on the board, including non-executive directors Sir James Fuller and Richard Fuller.
On his final set of full-year figures for the group, the outgoing chairman said it had been an 'excellent' past year.
Mr Turner added: 'This strong performance has been achieved despite the business operating in a challenging and, at times volatile, economic environment.
'The geopolitical situation has caused uncertainty in global markets and the decisions made by the Chancellor in her October budget hit the sector hard and reduced confidence in hospitality stocks.'
An outspoken critic of the move to raise national insurance contributions (NICs) from April, Mr Turner said: 'The changes to national insurance contributions took everyone by surprise and I fear it could be terminal for a number of smaller operators in our market.'
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