Mounting costs inevitably have to be passed onto customers, says Dunstable pub

A high street pub in Dunstable is feeling the strain of rising operating costs, as it faces wage increases, tax pressures, and high overheads.

Miles Ellis, Director of The Old Sugar Loaf, said the business climate has shifted significantly since the pandemic, with the current economic situation forcing businesses back into instability.

Speaking to Greatest Hits Radio, he said: "There’s been a massive change in staff wanting to come and work here, but it doesn’t necessarily mean gaining the staff that we want.

"We’ve got a very busy site. We need a very strong team behind us. Keeping that team is the struggle, especially with increasing costs and National Insurance hikes."

The upcoming annual increase to the National Minimum Wage, coupled with recent National Insurance changes, is adding further pressure.

While Mr Ellis says the business commits to fair wages for employees, he said the business is having to make difficult adjustments.

"Ultimately, we’ve had to reduce hours for our staff and employ more staff. Our wage budget has stayed the same but it’s gone up without employing any more staff or getting any more hours."

And like other businesses, the pub is reluctant to increase its prices and risk losing customers in an already competitive environment.

Mr Ellis added: "We swallow as many price hikes as we can to pass on to the customer, but we will end up having to pass on some kind of increase against the ones we’ve already swallowed."

Despite the challenges, The Old Sugar Loaf remains proudly independent, having previously been part of a larger group before restructuring to operate under a separate ownership model.

This independence allows the pub greater flexibility in procurement and operations, but it doesn't insulate it from economic challenges.

Rising costs across the board — from business rates to music licensing and utilities — continue to challenge high street businesses.

Mr Ellis said: "We’re in an area where we can’t charge London prices, but we’re not too far off that in terms of property, which gets passed on in rent."

Mr Ellis credited the business’s stability, in part, to support from their accountant.

"It’s not someone that you see once a year, it’s regular conversations… Having the data behind us has been fantastic," he said. "You’re not taking a stab in the dark."

What does the government say?

A government spokesperson said: "We are a pro-business government, and we know the vital importance of pubs to local communities and the wider economy, which is why we are supporting them with business rates relief, a 1p cut to alcohol duty on draught pints, capping corporation tax and are protecting the smallest businesses from the employer National Insurance rise - which is helping to fund the NHS."

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