Scottish hospitality empire makes plea to punters as extra £1.7 million wage bill hits profits

One of Scotland’s highest-profile hospitality operators has warned that its annual profit projections are “almost impossible to achieve” after being hit by soaring costs and an additional £1.7 million labour bill.

Edinburgh-based Signature Group, which runs more than 20 bars, restaurants, hotels and a brewery, said it now had “no choice” but to raise its prices, while urging customers - already reeling from the cost-of-living crisis - to continue supporting the hospitality sector.

Louise MacLean, business development director for Signature, said the changes in employer’s national insurance contributions and thresholds announced in the autumn Budget, which come into force this month, alongside the rise in the minimum wage, would trigger additional annual labour costs of £1.7m.

Signature Group runs more than 20 bars, restaurants, hotels and a brewery. Its venues include The Huxley in Edinburgh's West End.

“The struggles we face are very real,” she said. “This situation makes our profit aspirations for 2025 almost impossible to achieve. We genuinely want to grow, expand and create jobs; however, unless the government listens to our concerns and addresses our plight meaningfully, thriving in this industry will rely more on hope than on actual business success.

“The ripple effects of these increases will be widespread, and we have no choice but to raise our prices as a result. We urge our customers to continue supporting the hospitality sector, and we will strive to deliver exceptional customer experiences by providing quality and value at every opportunity.”

The group runs bars, restaurants, hotels and a brewery, with venues in Edinburgh, Glasgow, Aberdeen, St Andrews and Bridge of Allan, including The Huxley in Edinburgh’s West End.

MacLean added: “While we are absorbing as many of these costs as we can, price increases are inevitable. We have some exciting expansion plans for 2025; however, these will need to be funded through external sources, as our retained profits have significantly diminished."

In an interview with The Scotsman last October, Signature owner and managing director Nic Wood vowed to continue investing in the business despite the challenging backdrop, which has seen several pubs and restaurants go to the wall.

“I don’t think it’s getting any easier,” he said at the time. “At certain points we were looking at shutting certain pubs in order to keep the more profitable ones open. Then we went through a stage of perhaps only opening profitable hours.”

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