More on KentOnline
January was a brutal month for businesses in Kent, with at least 17 closing for good.
KentOnline reporter Chantal Weller spoke to local experts about why it’s been such a tough time – and asked if, and how, the outlook could improve…
“It’s impossible to stay afloat, let alone make a profit.”
That was the damning verdict of the bosses behind Jerk N’ Tingz in Dover when they announced the shock closure of their Caribbean-inspired restaurant last week.
The venue at the town’s St James retail park was just the latest in a long line of Kent firms to have shut in January.
From independent chip shops and pubs to national chains, at least 17 businesses have called it quits already this year.
So, why is January such a difficult time, particularly for those in the hospitality sector where the bulk of closures have been?
Business expert Richard Scase, who is an emeritus professor at the University of Kent, says the cost-of-living crisis has left potential customers with little money to spend, particularly after the festive season.
“The boom period is always in the run-up to Christmas and the new year when annual consumer spend is at its highest,” he said.
“It’s the time of the year when businesses generate a major share of their revenue and profits.
“This year has been particularly bad for the retail and hospitality sectors because of the cost-of-living crisis.
“They are also the sectors where there is a high percentage of small, independent and family-owned businesses.
“They operate on low-profit margins and if the autumn run-up fails to deliver customer spending, they find themselves in a vulnerable financial situation.
“Come the new year they take the realistic decision to call it a day.”
This was the case on the very first day of the month when it was confirmed The Aviator Pub on Sheppey was closing and going on the market.
Its owners said at the time: “Unfortunately, the ever-increasing utilities have made things impossible to continue.
“We’ve had some great times at The Aviator but all good things come to an end.”
On the same day, The George Inn near Faversham shut – just five months after re-opening with new hosts who’d had high hopes of making the pub a success.
Tudor Price, chief executive of the Kent Invicta Chamber of Commerce, says many pubs and restaurants were hoping for a Christmas business boom – but it turned out to be a bit of a festive flop.
“It was a fairly grim Christmas for a lot of retailers and hospitality,” Mr Price.
“Energy costs are manageable and coming down a bit but it’s too late for many a business.
“For those who were relying on a Christmas boost to see them through the next few months, this didn’t really materialise.
“The cost of things is still going up and we are seeing a slightly more gloomy picture than we were seeing just before Christmas.
“The prospect of further supply chain issues and costs potentially rising with that also had an impact.”
Fears have been expressed about new Brexit health checks on foods arriving at Dover causing problems with supply chains, along with the disruption in the Red Sea.
Mr Price says political uncertainty – with a General Election to take place this year – is also hitting confidence. However, after the country goes to the polls, this could all change.
“We might start to see a few businesses take some risks and that actually then starts to create its own momentum,” he said.
“Most businesses came off the back of the pandemic fairly weak and borrowed quite heavily in some cases.
“They’re trying to maintain their customer base but, of course, the customers have been squeezed with energy costs and their cost of living, so they’re not spending money. There's a common theme across the pitch.”
The Hare and Hounds pub in Deal had cited a “lack of support” from customers before its closure on New Year’s Day.
The following day, much-loved Whitstable chip shop V.C. Jones shut after 62 years in the town. The owners said they were retiring and wanted to “focus on what’s really important in life”.
Then on January 3, a temporary Job Centre Plus in Ashford closed.
Mr Price says 95% of businesses employ fewer than 10 members of staff. This is why some firms, often family-run, struggle – as they cannot cut costs by reducing staff hours or axing some roles completely.
This is a measure that medium- to larger-sized businesses can take. For example, Boots is looking to close 300 stores nationwide, including its site in Northdown Road, Margate, which shut on January 20.
“They are taking preventative action to make sure that business continues beyond the next 12 to 18 months by making some serious cutbacks on costs,” Mr Price said.
“If you are just a small, independent business, you don’t have that option – you have to decide to pack it up.
“All businesses receive common pressure but there are subtle differences based on how they make their money and where they make their money from.”
Another national chain which shut on the same day was Costa in King Street, Maidstone. A note appeared in the shop window just days before with staff thanking their loyal customers.
Business owners have given a variety of reasons for why they have closed over the past few weeks.
On January 6, KentOnline reported how a shopkeeper had blamed the construction of a neighbouring housing estate for the closure of a beloved farm store after almost two decades.
Joanna Miles had worked at Broad Oak Farm Shop in Sturry, near Canterbury, since it opened in 2006, and said the works associated with the nearby Woodlands development contributed to its demise. She says customers were put off by long-running roadworks needed for the 465-home site.
Four days later, Cheran's Bakery branches in Canterbury, Faversham, Maidstone and Rochester all closed with owner Cheran Friedman making the decision following “ever-increasing rents, rates and utility bills”. The Sittingbourne branch remains open.
On January 19, KentOnline reported on the loss of Patisserie Valerie in Canterbury. A sign displayed in the shop’s window did not explain why the decision had been made.
On the same day, Earl St Vincent pub in Ramsgate shut for good as the landlord said she wanted to “find herself again”.
She said: “I’ve had so many ups and so many downs, but now it’s time for me to close the doors.
“I’m not going to go into [the] reason why this decision is happening, but as a team, we have all made this hard decision.”
Last week, Saffa Bru on Folkestone harbour arm shut after only seven months of trading. Harbour arm bosses said that “industry-wide in the UK, 60% of restaurants will fail within the first year. A further 80% won’t make it past three to five years”.
Prof Scase says some businesses fail because there are weaknesses in their business models.
“Poor locations, mediocre customer service, poor staff training, failures in pricing and product mix – all can be reasons for business failures and any small fall in demand can expose these vulnerabilities,” he said.
“Doing business in the retail and hospitality sectors is high risk at the best of times because customer choices or the search for new lifestyle experiences can change so rapidly.”
The final business to close in Kent last month was The Window Workshop in Ramsgate which shut after 26 years.
Bosses said they had battled mounting financial pressures amid the cost-of-living crisis, interest rate hikes and lockdowns before taking the “emotional decision” to shut.
“The attraction to be your own boss continues to be seen by many as better than working for someone else...”
Is it just the case that January is always the toughest time for businesses?
Mr Price fears that firms will continue to struggle in the months ahead.
“I think certainly for the next six months we are going to be getting more bad news,” he said.
“We will see perhaps more closed shops and more businesses announcing they’re scaling back for a while.
“A lot will depend on what happens next in government.”
So is it really, as Jerk N’ Tingz owner and chef Matthew Omo-Bare said, an “impossible” task to make a success of your business in Kent at the moment?
Despite the gloomy outlook, Prof Scase says after small firms close, most are replaced by new or growing entrepreneurial ventures.
He said: “The appeal of business ownership remains robust in Britain’s enterprise culture. The attraction to be your own boss continues to be seen by many as better than working for someone else.
“This is even when all the odds are stacked against them in the present-day challenges facing our local high streets.
“Shopping centres and shopping malls on the outskirts of the county’s towns and cities make it hard to run profitable businesses in city centres.
“High business rates and rental charges make it even tougher – the future is always uncertain.”