BENGALURU: There is a gradual decline in the number of watering holes in Pub City, especially in the past six months. Sources in the Food & Beverage (F&B) industry told TNIE that a 50 per cent hike in Excise licence fee, cut in corporate spending and insecurity regarding jobs have left telltale signs in falling footfalls and winding up of some liquor outlets.
“In the last six months, around 50-60 pubs and bars in the city have either shut shop or exchanged hands,” said Chethan Hegde, National Restaurants’ Association of India (NRAI), Bengaluru chapter head, and owner of ‘1522’, a prominent chain of pubs in the city, “Hike in licence fee, manpower and rentals, along with escalation in liquor prices in the last couple of years has adversely impacted F&B business in the city,” he added.
“Bengalureans are grounded and smart spenders. An increase in liquor prices is impacting people, who love to dine out. They have cut down on the number of occasions they would go out to dine. It is liquor that spirals up the restaurant bill and people are being careful. Many have home bars. Instead of drilling a hole in their wallet to dine out, they would rather call in food from outside and relax with friends at home, at a much lesser cost and for a longer time, with no added headache of navigating through traffic and parking woes,” said another pub owner.
The owner of a popular microbrewery said that with a 50 per cent increase in the Excise licence fee, some microbreweries in the city may not be able to renew their licences.
“It is becoming difficult to do business. The annual CL-9 licence (pubs & bars), which was earlier around Rs 9 lakh, is now Rs 14 lakh. Rentals in Bengaluru have gone through the roof and so has manpower cost. It is not easy to sustain a business because the burden is passed down to the guests, who are feeling the pinch. Additionally, rain is a spoiler. We are seeing a dip in footfall in pubs and bars,” the owner said.
‘Newcomers find it difficult to survive’
Amit Roy of Watson’s, a popular chain of neighbourhood bars, said, “While most of the old-timers can sustain licence and rental hikes, it is some newcomers who are finding it difficult to pull through because of unplanned expansion and unnecessary capital expenditure. They have set up huge places. Naturally, the overhead costs of running them, along with high liquor costs, are making business untenable,” he added.