Licensed trade receives boost from increased spending on card

When the 2013 budget was announced there were a number of sectors who reacted in different ways to the points which were set out by George Osborne.


The extension of shared equity schemes and the raising of the tax limit were undoubtedly among the major talking points. However, the scrapping of the planned 3p rise in beer duty was possibly the biggest surprise.


The fact that the coalition government went even further in cutting beer duty by 1p was greatly welcomed by those within the licensed trade.


New hope for the licensed sector


It seems that the decision has breathed new life into the licensed trade generally, with new research from Barclaycard showing that consumers have taken advantage of the cut.


The research indicates that spending in UK pubs on credit and debit cards has increased by an average of 4%. Growth in certain regions has been even more significant with Wales (11.8%), the North-East of England (6.9%) and the East Midlands (5.4%) all experiencing strong growth.


The research looked at spending within pubs in the 2 weeks before the introduction of the cut and the 2 weeks directly after.


Although the growth could be described as quite modest, it certainly represents further momentum for an industry that has rather been suffering lately. A number of pubs of all shapes and sizes have been struggling throughout various parts of Britain as the trend for purchasing alcohol from supermarkets continues to affect pubs. This trend has seen a large amount of pubs fall into administration.


However, the government has clearly been keen to target the licensed trade as an area which could serve to contribute effectively towards economic recovery if given a helping hand. The beer duty cut may have been exactly the break that it required and time will tell if the sector’s recovery continues.


Licensed trade specialists


Moorfields has a great deal of experience working with companies within the licensed sector who are moving closer towards insolvency. We also have specialist experience of working on behalf of banks which have interests in this sector and advising them about the most financially sensible way to proceed.


If you would like to have a free no obligation chat with one of our advisers please call us on 0207 186 1143.

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