Survey: 14% of Scottish venues face closure
Nearly 60% of hospitality businesses in Scotland expect to make a loss this year, with 14% considering closure, according to a new survey.
A survey by the Scottish Licensed Trade Association (SLTA) revealed that 59% of businesses expect to be loss making in 2025.
Profitability in 75% of outlets was down when compared to last year, with 56% of outlets reporting a decline of over 10%, according to the Scottish On-Trade Market Insight Survey Report in August.
Meanwhile, 56% of outlets predict a decline in trading for 2025 and 14% of outlets are planning to or are seriously considering closure. The SLTA said this figure is more than double the number from its January 2025 survey (6%).
In terms of trading for the first half of 2025, 38% have experienced a major decline compared to the same period last year, while 16% reported a slight decrease. Only a quarter (26%) said trading this year was the same as the first six months of 2024.
‘Most negative’ findings to date
Colin Wilkinson, SLTA managing director, commented: “We’ve spoken repeatedly about the many challenges Scotland’s licensed hospitality sector continues to face. In recent years, it navigated the stormy waters of Brexit, the Covid pandemic, rising utility bills, and the ongoing cost-of-living pressures that have impacted on businesses’ operating costs and consumer spending.
“However, in the 10 years that we have been conducting our market insight surveys, these findings are the most negative we have seen – these insights are extremely concerning and the only word to describe the current trading conditions is ‘brutal’. There has never been so much business uncertainty.”
Business have faced hikes in National Insurance contributions (NICs), rising costs and a challenging consumer environment. Wilkinson said the increase in NICs has impacted staffing and opening hours across the industry, with nearly a third of outlets cutting employment levels.
“Spiralling costs to businesses from the chancellor’s hike in employers’ NICs in the autumn Budget, which took effect in April alongside increases in the national living and minimum wage, are having a devastating impact on Scotland’s pubs, bars, hotels and hospitality venues,” he continued.
“Businesses are reporting lower income as a result of current low consumer confidence and reduced footfall – and, of course, we continue to call on the Scottish and UK governments to work to support one of our key industries.”
The survey found that nearly 90% of respondents expect the Scottish economy to decline this year.
In next year’s Scottish elections, 75% of venues stated that they would like the next government to address rates discrepancies with the rest of the UK.
Wilkinson said the most “most effective way” for the government to support the industry was to cut VAT for hospitality and hold a review of the commercial rating system.
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