Crisis as nearly a fifth of UK fish and chip shop owners to quit by next June

Nearly a fifth of UK fish and chip shops could shut within a year as owners warn Labour has killed Britain's traditional takeaway. Desperate please for a VAT cut to help the struggling industry are still being ignored as owners face dwindling margins amid soaring costs.

Nearly 45% of chip shop owners were "extremely worried” about the future, according a survey of 105 businesses by the National Federation of Fish Friers (NFFF). Meanwhile, 19% said they planned to leave the trade within the next 12 months, according to findings that have been presented to the Department for Business and Trade.

And an overhwleming 90% were “not confident at all” in Labour's understanding of small businesses, with one respondent declaring the Government has "killed the Industry".

The Express has launched a Save Our Fish & Chips crusade to support the businesses fighting for survival.

NFFF president Andrew Crook said a from 20% to Europe’s average rate of 12.5% would "not only protect businesses, but also provide those much needed jobs". He added: "It is evident that things are not working as they are."

It comes as proprietors told of cutting staff to make ends meet. An elderly owner shared: “I think I could go bankrupt soon unless I start working (replacing staff) for 60 plus hours per week. I am 75 years old and should be able to afford some sort of easier life, but it’s getting harder and harder.” Another said “margins are tighter than they’ve ever been”.

Takeaways must pay 20% of their hot-food income to the Government, but because the fresh food ingredients they buy are exempt from tax, they cannot counterclaim on the vast majority of their outgoings.

Katrina Hasanbasoglu, who runs an award-winning Makerel Sky in Stamford Brigde, east of York, said: “Hospitality has always been an industry where we pay more VAT than we claim back. Other industries, they'll buy something with VAT on it…but they can claim a massive amount back on the original VAT that they bought the raw product."

Many shops have introduced new species to offset rising prices, with 60% of respondents having done so. Ms Hasanbasoglu introduced hake, and although it was up to £3.50 cheaper than cod, she had to remove it from the menu because it was not selling.

“People still want the cod and haddock,” she said. But she now pays 163% more for a box of haddock than in 2023.

While customers like sticking to traditional species, they aren't always happy to pay the rising prices, which is further impacting trade.

“Unfortunately, people always say that fish and chips is a working man's meal. They go to a pub and they'll pay £35 to £40 for a steak, but they won't pay £12 for fish and chips," said Ms Hasanbasoglu.

She stressed: “Fish and chip shops aren't here to rip you off. They do have expenses, and if a fish and chip shop charges a certain amount for fish and chips, that means they've looked at it and that's what they need to make a sustainable business.”

Since cod and haddock numbers cannot keep up with demand, the industry is trying to tempt Brits with similar white fish species from Norwegian and Icelandic waters, such as hake and saithe.

Mr Crook said: “There are lots of underutilised fish species landed in the UK. We tend to import much of what we eat and export much of what we catch.”

He said rockfish is now deemed sustainable, Monkfish can be cut into chucks to make 'scampi' and his favourite is langoustine, with a “fresh sweet flavour”.

Amid this financial pressure, 60% of the businesses have had to reduce their team members, more than 50% said they employ fewer young people, and nearly 50% decreased their operational hours.

Mr Crook said this was worrying for younger generations, especially following the Alan Milburn report last month, which showed nearly one million people aged 16 to 24 in the UK were not in education, employment or training.

While he said it was “encouraging” that Rachel Reeves will temporarily slash VAT from 20% to 5% on children's meals during the summer, he added, “they need to be brave and follow much of Europe" with a lower rate across the board.

A government spokesperson said: "We have the right economic plan - we're backing hospitality by cutting VAT on family attractions and kids meals this summer, reforming business rates, with a £4.3bn support package to limit bills rises, capping Corporation Tax at 25%, cutting red tape and taking action on the cost of living to boost the sector."

Has your favourite local chippy shut? Are you an owner struggling to stay afloat? Share your story with sarah.barltrop@reachplc.com