Living wage could be a bitter blow, Wetherspoon’s boss Tim Martin warns

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“The recent government announcement regarding the ‘living wage’ adds considerable uncertainty to future financial projections in the pub industry,” said Martin.

“The average price of a pint in a supermarket is less than £1 and we estimate staff costs to be around 10% or 10 pence.

“In contrast, a pint in a pub costs around £3 and staff costs are about 25% or 75 pence. Increased labour costs therefore affect pubs with far greater force than supermarkets.”

 

Martin was speaking as Wetherspoons reported that sales grew by 2.9% on a like-for-like basis in the past 11 weeks and that profit margins were down from 8.3% to 7% in the past year.

 

The business had already indicated that full-year profits for the year about to end would not be higher than the previous one’s.

But the shares still fell 37p, or 4.8% to 734p.

Source Article from http://www.standard.co.uk/business/business-news/living-wage-could-be-a-bitter-blow-wetherspoons-boss-tim-martin-warns-10390504.html

July 16, 2015 |
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