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Business Rates in Need of a Root & Branch Overhaul – Fuller’s

Commercial People has learned of the problems that Nandos, Fuller’s and other major retailers across the UK face, and how they intend to collectively ‘save the British high street’.

In an extensive 3-part Common’s Select Committee meeting yesterday, Commercial People were made aware of plans and problems that the major food & drink firms had, as they gave their evidence alongside House of Fraser boss Mike Ashley, and other major retailers such as Marks & Spencer & New Look.

Click here for more coverage of the decline of The British High Street

Forming part of the ongoing inquiry by the Housing, Communities and Local Government, the inquiry aims to find out more about the current climate for traders and the challenges major businesses face to remain viable in the harsh retail environment of the UK’s high streets.

In an age where more people are spending a record less on alcohol and going out, restaurant firms and pubs alike are often at the brunt end of the economic dip.

However Fuller’s Chief Executive, Simon Emeny maintains noted that despite the downturn, “pubs can provide a social link”, citing Fuller’s diverse portfolio of pubs in historically listed buildings as a key example of the different clientele now attending pubs.

Mr Emeny added: “I think if you look at Pubs today compared to 10 years ago, they have evolved, and pubs are linked a bit more to the [demands of] the community, providing breakfast pastries and coffees.”

The CEO, however, was less complimentary regarding the much-criticised business rates that businesses across the UK face, stating that those were the “biggest challenge” Fuller’s were facing in the current climate.

Mr Emeny asserted: “The biggest challenge we have is in taxation and the fact that our pubs pay the third highest [business] rates in Europe – which is crippling our industry.

“Pubs are disproportionately taxed when it comes to business rates; as a result, in our business, we pay just under 5% of our total turnover in business rates.”

Nandos, the Portuguese chicken restaurant firm hailing from South Africa, is synonymous with Britain’s young generation and its success has seen the company open several restaurants across the UK including it’s 7th in Northern Ireland.

Explaining their success amidst the closures faced by other shops on the high street, Nando’s Chief Operating Officer Maria Horn said: “I think it’s fair to say we are an attractive tenant.

Ms Horn elaborated: “We have never closed a restaurant, and we choose our sites carefully, as when we do open, we aim to remain in a location for a long time.

[on choosing a site] “We are wise when and how we choose to go into a [property] development, as we want to be there for the long term and not just the short term”

Despite their success in an overwhelmingly bleak period for British retail, Ms Horn concedes that Nando’s success cannot save the high street all by itself.

The COO concluded: “We operate well alongside other retailers who are thriving (e.g. Cinema’s and malls), thriving spaces are #really key to us, and critical to our business.”

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