THE new year was less than one week old when dark clouds began to descend on the hospitality industry.

Pubs, restaurants, hotels, and late night venues were already dealing with a well-documented cost crisis which began the best part of two years ago and has led to a steady rise in business closures. But the closure rate appears has risen sharply in the immediate aftermath of the festive season.

My first Business Voices column of 2024 reflected on the demise of several high-profile hospitality businesses in the first week of the year, heightening fears for the future of the industry.

There was widespread shock across the sector when it emerged that TV chef Simon Rimmer, host of Sunday Brunch with Tim Lovejoy on Channel 4, had decided to close Greens, his long-standing vegetarian restaurant in Didsbury, Manchester, after 35 years. Announcing the decision, the restaurateur said the rising cost of energy, raw materials, and staff had made the business “unviable”. “It is a heart-breaking day,” he declared.

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Unfortunately for the hospitality trade, this was not the only high-profile closure in early January.

Just as news of Greens’ closure began to circulate, fellow chef Tony Rodd and wife Becky announced the closure of Copper & Ink, their celebrated restaurant in Blackheath, London. The operators posted: “It is with heavy hearts that we announce the immediate closure of Copper & Ink.

“We have agonised over making this decision and spent much of the Christmas break trying desperately to find a way to save the restaurant, but to no avail.”

As the column noted, the closures sent shockwaves throughout the hospitality industry in Scotland, where trade groups have been warning of business failures as outlets struggle with the continuing cost crisis against a backdrop of weak consumer confidence. Further closures have been occurring across the UK at a worrying rate since those high-profile outlets ceased trading in early January.

But it is not just the hospitality industry that has had reasons to worry. As revealed in my exclusive story in The Herald in January, more than 4,500 shops in Scotland are “staring down the barrel” of significant hikes in business rates when the new financial year begins in April.

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It comes after the Scottish Government increased the intermediate and higher property rates, which are respectively used to calculate business rates for premises valued between £51,001 and £100,000, and for those valued above £100,000, in line with inflation at the Budget in December.

In response to written questions from the Scottish Conservative and Unionist MSP for Mid Scotland and Fife, Liz Smith, minister for community wealth and public finance Tom Arthur released figures which showed around 4,500 shops would be subject to the intermediate and higher property rates from April. Some 2,140 stores will be liable to pay the intermediate rate, which will increase to 54.5p from 51.1p in April, while 2,410 shops will pay the higher rate, which is going up to 55.9p from 52.4p.

David Lonsdale director of the Scottish Retail Consortium, said while the industry welcome ministers’ decision in the Budget to freeze the basic property rate, which applies to premises valued up to and including £51,000, at 53.1p, shops liable for the intermediate and higher property rates will see their rates bills rise to a 25-year high.

Mr Lonsdale said: “This increases the cost of maintaining a store estate and serves to make things even trickier. We need to see a faster pace towards restoring the level playing field with England on the higher property rate.”

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There was further upheaval in the retail sector in January, when I reported that Marks & Spencer was closing one of its oldest stores in Scotland. M&S announced that its department store on St Nicholas Street, Aberdeen, will be shuttered for good in the spring of 2025. That will be when work is completed on the retailer’s £15m project to nearly double the size of its store at Union Square in the city centre, part of a £30m programme to develop the M&S bricks and mortar estate in Scotland over the next 18 months.

M&S said its plans, which include five store openings and a range of expansions, will support more than 6,300 jobs across the country. Local politicians expressed disappointment over the closure of the store on St Nicholas Street, which has been a major presence in Aberdeen since 1944 and called for a taskforce to be set up to examine the implications of the decision.

It is the latest major store to close in Aberdeen, following the demise of Debenhams, John Lewis, Esslemont & Macintosh, and House of Fraser in recent years, raising concern that the decline of retail in the city centre may undermine hopes to revitalise the key Union Street thoroughfare.