Bromley Cross: The Railway landlord on energy price rises

Landlord of The Railway in Bromley Cross spoke about the rising costs facing the industry just days after pub bosses warned that public houses could shut - unless Government stepped in to support the trade.

Michael is having to make large-scale changes to the way his pubs operate

Michael Hales, aged 48, runs the local, alongside two other pubs in Wales. He and his staff have been feeling the burn of the cost-of-living crisis.

He said: “Our electricity has gone from £2,000 a month back this time last year to nearly £9,000 this year.

“Our gas has increased from about £700 a month to £2,500, that’s over a 300 per cent increase.

“And then if you throw in the rising cost of beer, the rising cost of staff, the rising cost of everything really. It’s just a catalyst for the pub industry, it’s just a nightmare isn’t it.”

Michael has complained about the hike in electricity prices.

Electricity prices at The Railway have gone from around £2,000 to nearly £9,000 monthly

He said: “We filed a complaint with the ombudsman – they were very bolshy, you either pay it or we cut you off kind of thing, so our energy broker has filed a complaint with the ombudsman so they’ve backed off.

“So we’ve just gone to them and said well we’ll just keep on paying the £600 a week we normally pay, so we’re paying for the usage we’d normally pay, that we can afford, and anything else you’ll just have to sort it amongst yourselves.”

He said how the pub have had the odd occasion where they’ve run out of things as a result of holding less stock.

“We’ve had to be more efficient with stock. At one time we’d probably sit on about 15-20 thousand pounds of stock, food and drink, now it’s probably more like eight or nine thousand. It’s halved because we need it to pay what we can.”

Michael continued: “The pressure across the industry is immense at the minute.

Where the pub would usually have around £15-20k in stock, they've had to reduce it to around eight to nine thousand pounds

“There’s lots of talk about the cost of living for the general public, but there’s no mention of business.

“The business stuff is just starting, but it’s getting people talking about it. The cost of a pint will probably be about £6 in a couple of months.

“You’re fighting the rising costs of products against when you know people have got less to spend.”

He continued: “We’re having to revisit our business model. What is a very successful business model now needs to be looked at and remodelled.

“It takes a lot of time and energy to do – a good example of that is we may have to shut till five o’clock and only open from five onwards to reduce electric costs, staff costs.

Pubs are feeling the squeeze between the rising cost of beer prices and the knowledge that people have less money to spend, according to Michael

“We’ve got three sites at the minute, but we had six before Covid. Covid was hard, we’ve still got Covid debts that we’re paying off, but this energy crisis feels like it’s going to be a bit harder to get through than Covid, because we’ve not really got any support, Covid you had support.

“But I know there will be a lot of worried landlords and landladies out there wondering what’s next, cause obviously a lot of us invest our own life savings into pubs.”

Michael gave his thoughts on the future: “It’s hard at the minute to see, if there’s no drastic change in the energy market for pubs and restaurants, there’s going to be a lot of hard decisions, businesses become not profitable.

“We’ve gone from being very profitable to being not profitable in the space of a year, because it’s taken up by the energy cuts, the profits are absorbed by the rising energy.”

Read more: Bolton pub owners warn of closures unless urgent action is taken

Bosses of six of the biggest brewing companies nationwide, some of which own pubs in and around Bolton, have warned that pubs and brewers are at risk of closure amid the price hikes.

They signed an open letter to the Government, urging it to act to avoid “real and serious irreversible” damage to the sector.

Meanwhile, over in East Lancashire, The Park in Great Harwood has been forced to close due to rising costs.

Their owners say that they can't afford to keep their pub open as the cost-of-living crisis continues.

Dozens of people have left messages of support for the current landlords.

Do you have a story of a pub or another business falling on hard times during the cost-of-living crisis? Feel free to email me at zach.harrison@newsquest.co.uk, or drop me a message on my Twitter, @zachhjourno.