Publicans optimistic despite escalating business costs

A majority of publicans believe their business will improve over the next three years, new research reveals. This increased confidence is leading to plans by many in the trade to invest and refurbish their premises.

The findings are revealed in a survey gauging publican sentiment on a range of issues commissioned by the Vintners’ Federation of Ireland (VFI) at its 45th AGM taking place in Letterkenny, from Monday 14th to Wednesday 16th May.

When asked about opportunities for growth, publicans cited an upturn in the economy as the number one reason for their optimism.  A strong tourism market and increasing popularity of pub food were also provided as other important reasons for positivity.

Incoming VFI President Padraic McGann commented: “The results of our survey confirm that VFI members are looking to the future with a new sense of confidence. I find it encouraging that so many publicans are prepared to invest in their premises, a sure sign they believe a corner has been turned.”

The pub remains a vital element of Ireland’s tourism infrastructure and with expectations that 2018 will build on last year’s record 10.65m visitors, VFI members will continue to benefit from this growth.

While confidence is returning to the pub trade some challenges remain, most notably the cost of insurance. Almost 60% of publicans say insurance is the biggest burden placed on their business. Sourcing and retaining staff is also a challenge as the economy continues to improve and the country approaches full employment.

The incoming VFI President adds: “Over the past couple of years, insurance costs for our members have increased to unacceptable levels. It’s no exaggeration to say it could put many publicans out of business. Change can’t come soon enough to the insurance sector.”

Speaking about the existence of a ‘two-tier’ pub economy, Padraic McGann says: “While pubs in cities, large urban areas and tourist hotspots are performing well, for some publicans the challenges of running a business in a rural location are overwhelming. We call on the government to implement proposals that will help rejuvenate rural areas as outlined in its planning framework document Ireland 2040.”

When it comes to consumer habits the survey also revealed that customers have become more discerning over the past three years. 88% of publicans say their customers are looking for a broader range of drinks while 92% say a higher quality of service is expected.

The demand for more choice is reflected in the findings where 93% of publicans say they are selling a wider range of gins while 57% are selling a wider range of whiskies.

The incoming VFI President adds: “Publicans have made a huge effort to meet changing consumer demand, whether it’s in a wider choice of drinks or improving their food offering. Publicans understand they have to work hard to get customers through the door.”

Research was conducted by the VFI in April 2018 amongst 379 publicans  

The research results also offered some other interesting insights, including

  • 75% of pubs sponsor a local team
  • 83% of publicans say their customers have become more adventurous with food
  • 43% of publicans serve food in their pubs
  • 84% of publicans host charity events
  • 15% of pubs host TD clinics

The VFI was established in 1973 from smaller associations for the protection and betterment of the livelihood of the individual publican.

The VFI has over 4,000 members, representing approximately 30,000 jobs.