Wetherspoon adopts cautious outlook amid Budget uncertainty

JD Wetherspoon, one of Britain’s largest pub operators, has struck a cautious tone as it prepares for the Government’s Autumn Budget later this month. Chairman Tim Martin warned that uncertainty surrounding potential tax rises and increased labour costs could threaten recent gains in the pub group’s trading performance.

The company, which runs more than 800 pubs and hotels across the UK and Ireland, reported a 3.7% rise in like-for-like sales for the 14 weeks to 2 November, driven by a 5.7% increase in bar sales. However, hotel room revenue fell by 6.3% during the same period, reflecting uneven consumer confidence across hospitality sectors.

Cost pressures widen the gap between pubs and supermarkets

Tim Martin once again voiced his long-standing criticism of the tax imbalance between pubs and supermarkets. He noted that pubs face rising costs at a time when the pricing gap between the on-trade and off-trade continues to widen.

According to Martin, a 10% wage increase translates to an additional 15 pence on the price of a pint in a pub, compared to just 1.5 pence in a supermarket. “Increased labour costs are dramatically widening the pricing differential between pubs and supermarkets, to the anger and consternation of customers,” he said. He also pointed out that pubs pay 20% VAT on food sales, while supermarkets pay none—a disparity that continues to erode pub profitability .

Citing analysis from Morgan Stanley, Martin highlighted that pubs have lost around 50% of their beer volumes to supermarkets since 2000. He urged policymakers to consider legislative reform to create a fairer tax environment for the hospitality industry.

Expansion continues despite uncertainty

Despite its cautious tone, Wetherspoon continues to expand its footprint. Over the year to date, it has opened four new pubs—in Kenilworth, Paddington Basin, London Bridge Station and Basildon—and expanded its franchising operations. The franchise model now includes 11 sites, among them five operated within Haven Holiday Parks and several run by student unions and family businesses such as Papas Fish and Chips .

The company plans to open 12 more franchised outlets before the end of the financial year, signalling continued confidence in the long-term potential of its brand, even as the broader market faces economic headwinds.

A wider call for reform

Martin also turned his attention to the broader business environment, criticising what he described as “ludicrous” UK corporate governance rules. In particular, he targeted the “nine-year rule”, which restricts how long independent directors can serve on company boards, suggesting that such policies contribute to the UK’s decline as a destination for initial public offerings.

Drawing comparisons with the United States, Martin remarked that major American technology firms—such as Microsoft, Apple, Meta and Amazon—operate under more flexible governance frameworks. He argued that the UK’s restrictive approach could deter entrepreneurial investment and innovation .

The view from hospitality

For the wider hospitality industry, Wetherspoon’s comments strike a familiar chord. Rising labour costs, energy prices and tax obligations have put sustained pressure on margins across the sector. With the Chancellor expected to unveil the Autumn Budget on 26 November, operators from pubs to restaurants are bracing for potential policy changes that could shape business planning well into 2026.

For fish and chip operators, who often share similar challenges around VAT, staffing and pricing competition with supermarkets and takeaways, Martin’s remarks serve as a reminder of the ongoing fight for fairer conditions within Britain’s food and drink economy.