There has to be something fundamentally wrong - restaurant closure

What people who voted Brexit wanted.

Agree with you. Our local town has lots of those “freed up resources”, i.e. empty shops, and it’s getting worse and worse.
Hardly anyone wants to go and seek out that one shop still standing amongst others that are boarded up.

Successive governments don't care about small independent businesses. Labour just absolutely hate ALL businesses. Tories hate small businesses and only care about their big business paymasters. We saw it during covid with over 3 million self employed/freelancers/directors excluded from the grants/furlough - that's a whopping 10% of the workforce excluded for no genuine reason. Whilst big business were given personalised/tailored support packages and whilst the general covid grants etc were available to property owners and not the tenants!

OP, if this is the restaurant in Manchester that recently emailed customers, I fully agree with you. The owners have put in so much of their own money to save it, to no avail. It was always busy but vicious tax rises have finished it off. Now a bunch of young people have lost their jobs. I just wish someone could explain to Rachel Reeves the damage she is doing to the very people her Government claims to support.

I agree, working in hospitality (and more widely in "retail") is considered work for students, people between "real" jobs, low status part time work for women, etc.
In other countries it's a career.

Business rates charged by local councils are a big issue. I know of a factory in England that made parts for certain equipment. It was successful for decades and even more so during COVID, when parts could not be got from China. Recently the council DOUBLED the rates. Manager of said company sold off some assets to meet the extra cost, and the business continued to succeed. Then the council put the rates up again. This time, there were no more savings to be had and the factory is having to close, with the loss of dozens of jobs. Both central and local governments need to decide if they want British businesses to succeed or not, and be honest about it, thereby not misleading current and future entrepreneurs.

We also had a much loved and very popular local restaurant that had been going for many years, close due to hikes in business rates.

Afterthought: prompted by a PP I just checked and yes, business rates are set by central govt, not councils; the councils just implement what govt decides. So something else to blame the wretched govt for!

And business rates.

That may have been me.

Also when people were asked "What if leaving the EU does make us worse off ?", those that did not shout "Project fear" quite happily said it was a price worth paying for sovereignty.

We are returning to the situation as it was in the 60s or 50s or before.

Which is what people wanted.

That's the crux - i.e. finding the "sweet spot". You don't know the effect until you do it and then it's often too late if it doesn't work out.

Raising prices by small increments is probably not going to work as you will lose some custom, but your income/profits won't be high enough to cover the lost trade. Also, customers may accept the first time it happens, but when they return a few months later and prices have gone up again, they may not return a third time.

Raising prices by too big an amount and you could lose almost your entire customer base!

Once the damage is done, it's hard to reverse the decision. A regular customer suddenly seeing the prices rise by 25% may never return as it will force them to look elsewhere and they may find somewhere else they prefer and won't ever know that you've reduced your prices again.

Every business is different and will have a different demographic of customers so there's no "Default" sweet spot for all businesses, so changing menus, prices, opening hours, etc will always have to be a "suck it and see" thing.

With our family newsagents/convenience stores, we were open 6.5 days per week, only closed Sunday afternoons, but we closed 7pm evenings the other six days. It's easy to say we should have opened longer and on Sunday afternoons, but we tried, and tried, and tried, but there was too little custom to justify it. We trialled Sunday afternoons for an entire Summer, thinking once customers knew we were open, it would get busier, but it never did. Yes, we had money in the till on a Sunday afternoon, but we quickly noticed they were regular customers who'd have paid their weekly paper bill or bought their magazines/chocolates on Sunday morning or Monday if we'd not been open Sunday afternoon - when we started closing again, those same customers returned to coming in on other days! Classic retail "displacement". We did the same with evening opening, but same result, very little "new" customers, so we stopped again. Over the 20+ years we had it, we also trialled all kinds of different things in the shop, from a National Lottery terminal, to slush machine, to selling lots of different types of things, such as being a Xmas toy catalogue commission agent, selling models after the town's big model shop closed, commission agent for a local coach tour firm, photo developing, etc etc. Sometimes, there simply isn't enough custom/footfall to survive. As for raising prices, we once increased our newspaper delivery charge by just 5p per week and were astonished that so many customers stopped their order - for just 5p - so we had to freeze the delivery charge after that and never risked raising it again!

2 by me are the same. One closed just after Christmas and had been open 30+ years and always popular/booked out. They just couldn't make the figures work.

The other was a bakery that had been open even longer. That one had been trying different things over the last few years to make it work so had lost it's way/identity a bit. I think they were damned if they didnt try to change and damned when they did.

Neither were "cheap and cheeful". Both charged what should be enough.

Thinking about it, I suspect the local cafe will be gone sooner rather than later too. Again, always busy. They charge £11 for a breakfast which seems fair (Ive never worked in a cafe but it seems like it should be enough to make a profit?) but they have reduced opening times, the menu and staff. They have also become cash only. That might be because of card fees but in ky exoerience is generally because of cash flow issues.

Busy doesn’t pay the bill. more often than not, busy places are under priced, which means more work for less money.
Less busy but better margins is the key, but the balance us hard to find.

Have you offered to pay more for your dinner there?

Would they be so busy if the menu was increased by 30%?

Minimum wage keeps increasing, their ingredients costs will be increasing, their fuel costs, their insurance costs etc etc etc. We keep asking for wages to increase for nurses, police, doctors, minimum wage etc etc etc. We want investment in public services. We want benefits for everyone. We want special care & schooling for every child who doesnt fit into the 'normal box'. Well this is the result, costs for everything go up and those who think they are getting more arent really, because they are no longer paying the same for stuff they need.

Its a vicious circle that will only end when we tear up the political system we have in place which rewards false promises and popularity votes. Mixed government with only the best person doing the best job for the country regardless.

Part of it has got to be employers costs - just the compulsory NI contribution plus the compulsory pension contribution makes an additional nearly 20% on an hourly wage. Its been a huge increase for our own small business and we are really struggling. Add to that the increases in rates, insurances, costs of materials (food prices have gone through the roof as we all know) , and suchlike its no surprise that however lovely they are, however lovely the food is, small businesses are falling like ninepins. And with the latest attack on dividends there aren't any incentives left to take a risk and start a business

I agree with the reasons quoted - cost of rent, utilities, supplies, labour etc however it wouldn’t also surprise me if part of this is just people have had enough. Working hard for a smaller and smaller reward. I would imagine the rewards of running your own cafe/restaurant etc aren’t just financial (although that’s the main one of course) but also community, pride, evolving your business l, using your skills etc. When you are just constantly hammered by government, when business people are not respected and entrepreneurs not supported in the end you say enough is enough. I think many business people like this might continue if they thought things are going to change/improve however it’s very clear that things aren’t getting better anytime soon. In fact I think it’s fairly clear that the government will be coming back for more this year.

I think this also applies to people like me, I could work if I wanted, I choose not to and cut my cloth accordingly.

The hospitality industry has always been up and down. Many well known names have not been able to sustain and grow businesses in the restaurant trade. Plus in the UK we don't consider service in hospitality as a profession. It's what you do until you find something better. That means service is really variable. Recruiting, training and keeping good people is difficult.

@ExtraOnions

Zombie businesses, who are barely ticking by, paying NMW, and not generating any real profit, are not good for the economy. The resources that they are using need to be freed up, for Buisness that can pay more, and generate more revenue.

You have to look at the bigger picture. These "zombie" businesses you talk about often help bring customers to the street or area where they are located. People are more likely to go to a shopping street/precinct where there are several shops/businesses, so those around the "zombies" are also helped from increased footfall.

I've seen it so many times, and we experienced it with our family newsagents/convenience store back in the 80s. We bought it when it was on a precinct of 7 shops including a butchers, greengrocers, chemist, bakers and off licence. It was a thriving/busy precinct as shoppers literally went from shop to shop. First the butchers closed and it was an absolute hammer blow - our takings went down by 10/20% overnight and never recovered but we survived. Then the green grocers closed who'd been more badly affected by the butchers closing. Our turnover down another 10/20% and so it went on. After several years, we were the last shop standing as all the others had closed.

Same has happened in our village. We used to have around a dozen shops including post office, newsagents, grocers, chemist, chip shop, butchers, bakers/pie shop, etc. Now all we have left is the bakers/pie shop. As each shop closed, the others suffered a loss in trade which in turn tipped them over the edge too.

It's how the High Streets in town centres are collapsing, once they lose one or more of the major "anchor" shops, the footfall drops and others close down too.

Same with cafes, pubs, restaurants, etc - they're not "Islands", they rely on the surrounding area, whether it's parking or public transport, complimentary businesses, etc. A pub next door to a restaurant will support eachother and when one closes, the other WILL suffer as people drink/eat somewhere else with both for a night out.

This. Landlords take the majority of restaurant profits. If the owner manages to increase profits then the rent just goes up at the next review. I’ve seen it happen several times in a popular high street near where I live: successful restaurants going out of business due to high rent increases. The landlord soon finds another person willing to give it a go because the location is so good.

They were closing long before that though. It's not just the government - the breweries make unrealistic demands on landlords, only allowing them to sell certain products and forcing them to buy upfront and so on. The breweries screwed over a load of landlords during covid by forcing them to buy beer they couldn't sell to anyone and which just went out of date. (That may not be exactly right as I am not a pub owner myself but my mate is, and they went bust during covid for this reason).

It's not a moral judgment - it's just the way of the world. Businesses and industries rise and fall and you have to roll with it. I've been made redundant four times in my career - it was gutting the first time, but it's how the job market works and you have to dust yourself off and move on. And yes, actually, I do think the same applies to steel workers.

ETA - I do agree that the hospitality sector is massively undervalued in this country though.

This literally makes no sense.

The reason they're closing is precisely because government has been stepping in.

They've just had a large NI rise and their business rates are going to go up probably massively in April. And that follows years of energy rises to pay for Net Zero plus numerous other state driven costs

I can fully understand why a restaurant may find its turnover doesn’t cover its costs these days.

What I don’t understand is why they wouldn’t try various changes first, before closing. For example price rises. If they are fully booked all the time, you’d think at least some of those customers will keep coming, even with a price rise? Then you’d see whether the stayers are enough to make the business profitable. Could also try things like closing on certain nights, reducing the menu, etc etc.

Sorry , what I really meant is “we dont say that about the steel industry without an outcry”. Because, quite rightly when an entire industrial sector is under threat , particularly if they include huge sites that employ a great percentage of local workers, there is much public outrage.

My point is that when the hospitality sector is spoken of it’s often in terms of entry level, min wage , temporary jobs as if these are somehow more easily dispensed with. And that workers will just switch to something else. In my opinion the hospitality sector is woefully undervalued.

From April 2026, UK business rates are changing following a new revaluation, with rateable values increasing by an average of 19.4% in England, and up to 70% for some pubs. To mitigate this, the government is introducing a £4.3 billion support package, capping bill increases at 15% for most businesses, with a 5p cut in the multiplier for retail, hospitality, and leisure.
Well it’s the clever govt. again isn’t it!?