JD Wetherspoon has highlighted the widening cost gap between pub pints and supermarket alternatives, urging customers to keep supporting their local despite steeper prices. Chairman Sir Tim Martin told shareholders on Wednesday that successive Conservative and Labour governments have worsened the existing price disparity between pubs and supermarkets by driving up labour costs.
"Whether this economic effect is desirable is, above all, a question for the public. To what extent does the public want pubs to retain their position in the UK's social fabric? 'How deep is your love?', to borrow a line from the Bee Gees," he said.
Labour Costs and Price Disparity
The pub group said labour costs account for £1.68 of every pint served across its venues, with the average pint price standing at £5.34 in May. By contrast, the average pint in a supermarket costs between £1.30 and £1.50, of which labour costs make up around 15p, Wetherspoon said.
Rising labour costs have "widened the price gap between a pub pint and a supermarket pint in recent decades, which has been a major factor in pubs losing half their beer sales to supermarkets since the millennium," the group said.
Budget Impact and Sector Response
Wetherspoon argued that above-inflation hikes to the minimum wage and increases to employer national insurance contributions have not only pushed up the price of a pint but have also led to job losses across the sector. The pub chain had backed a campaign urging the government to halve VAT for the hospitality sector to 10 per cent, which it argues is also responsible for the disparity with supermarkets, but John Healey failed to act on these calls at last week's Budget.
Instead, the Chancellor raised beer duty by 2p per pint, a move branded "breath-taking" by the sector. This decision "will undoubtedly push up the price of a pint," the British Beer and Pub Association has said.
Sales Growth and Expansion Plans
Despite these pressures, JD Wetherspoon said it remains on track to meet market expectations, posting 9.9 per cent sales growth in September, comfortably ahead of the 2.7 per cent industry-wide growth recorded by data firm NIQ. Over the past 14 weeks, the group has seen bar sales climb by 9.4 per cent, while food and slot machine revenue surged by 6.8 and 7.1 per cent respectively. This offset a 1.4 per cent decline in room sales across Wetherspoon's 55 hotels.
Sir Tim said: "The company has had a good start to the financial year. There are still three quarters to go and profit forecasts are very dependent on the level of sales growth."
The group, which operates 797 pubs across the UK, has opened six new sites so far this year, including at Manchester and Heathrow airports. It expects to open between five and 10 further managed pubs before the close of its financial year, alongside between 10 and 15 additional franchised sites.
Wetherspoon's push to broaden its presence at airports comes amid an ongoing dispute over whether passengers should be permitted to drink alcohol ahead of early-morning flights. Chairman Tim Martin has repeatedly clashed with Ryanair chief executive Michael O'Leary on the subject. The budget airline boss has accused airports of "profiteering" from disorderly drinking and claimed his airline is forced to divert one flight every day to deal with drunk passengers.
Shares in Wetherspoon fell 2.3 per cent to 1,001p in early trading.
