Pubs closing doors early due to high energy bills and staff shortages, says Black Sheep Brewery boss

Charlene Lyons, chief executive of Masham-based Black Sheep Brewery which also has four pubs in Yorkshire, said inflationary pressures were also having an impact on consumer spending.

She made the comments as she appeared on a live recording of the Business Unmuted podcast hosted by Recognition PR founder Graham Robb at the Vertu Jaguar Land Rover showroom in Leeds on Wednesday night.

She said: “Consumer confidence is lower than it has been for a very long time and if you think about what we are experiencing right now, you have got macro-economic pressures, you’ve got the cost-of-living crisis, you’ve got energy and fuel going up, you’ve got the war in Ukraine.

"There is an awful lot of uncertainty and political turmoil.

"People are getting scared. They are worried about their jobs and how they are going to heat their houses, how they are going to feed their kids. It is really challenging.

"It is absolutely having an impact on our trade and our sales.

"Pubs are open for less hours because there is an issue with staff and because they can’t afford to heat their big buildings. We’ve got people watching what they are spending.”

But she added that consumers with spare money are willing to spend on premium products.

"Although we are finding that premiumisation is winning. So if people have got some cash to spend, they are choosing to spend it wisely.

"So people will go to a pub and buy our product because it tastes great and the quality is good. They would rather spend 20p more on a pint than they would on something with less of a flavour profile. That’s really good for us.

"But we are looking to diversify. We have to diversify and change into different markets because we don’t know what’s coming and we have to make sure we are future-proofing our business.”

Speaking at the same event, Robert Forrester, Vertu chief executive officer, said he did not agree that concerns about an expected recession were being “overspun”.

He said: “Unemployment is low but the numbers of economically inactive people is very high.

"Mortgage rates are going to be a lot higher than they were so the impact on people is going to be quite significant.

"I wouldn’t underplay the impact. People are wary and I think they are probably right to be.”

But he added the situation was “very different” to 2008, when the financial crisis led to the availability of credit drying up.

"I don’t think we are in a 2008 scenario, that was a systemic failure of capitalism. We are in a far more interest rate inflationary environment which we didn’t have in 2008.

"We’ve got a situation where we are supply constrained, not demand constrained. There are lead time for vehicles, there is a shortage of used vehicles. We are not seeing big shifts in demand. If we had more cars, we’d sell more cars.

"We are in a very strange environment where there are supply chain issues and rampant inflation due to more money chasing not enough products which is what inflation is. It is a very different situation to what we’ve seen in the past.”