Running a pub has always been part business, part gamble, and part community service. But in 2025, with energy prices stubbornly high, business rates still biting, and wages at record levels, the question on every aspiring landlord’s mind is simple:
👉 How much does it actually cost to run a pub in the UK today?
The answer? It depends — on whether you’re tied to a pubco, freeholding your own boozer, or testing the waters with a managed site. But one truth cuts across the board: most pubs don’t fail because the beer’s bad — they fail because the maths doesn’t work.
This guide breaks down every cost of running a pub in 2025: upfront licences and deposits, fixed monthly bills, staff wages, stock, and even the hidden costs nobody warns you about. By the end, you’ll know whether your dream of pulling pints is financially feasible — or a fast track to pulling your hair out.
Upfront Costs – What You Pay Before Day One
Before you even pull your first pint as a landlord, you’ll need to shell out for licences, deposits, refurbishments, and stock. These costs vary depending on whether you go down the tenancy, leasehold, or freehold route, but here’s the average breakdown in 2025:
Licensing
- Personal Licence: £37 + a DBS check (~£25).
- Premises Licence: Usually handled by the pubco (included in agreements), but if you’re independent expect £100–£1,900 depending on council and capacity.
Pubco Deposits & Legal Fees
- Tenancy (tied): £5,000–£30,000 upfront.
- Leasehold (free-of-tie possible): £20,000–£100,000.
- Freehold purchase: £100,000–£1.5m+ depending on location.
- Legal & surveyor fees: £1,000–£5,000.
⚠️ Hidden trap: many pubcos require a “repairs deposit” (£2,000–£10,000) held against future maintenance.
Refurbishments
- Minor refresh: £10k–£30k (paint, furniture, signage).
- Full refurb: £50k–£250k+.
- Stat: Costs are up 20% since 2020 due to inflation in building materials.
Stock-in (First Cellar Fill)
- Beer & cider: £2,000–£6,000.
- Wines & spirits: £1,000–£3,000.
- Food supplies: £500–£1,500 (if serving food).
💡 Tip: Budget for at least £5k–£10k to have the cellar and bar ready for your first week.
👉 At this point, most new landlords have already sunk between £10,000 and £100,000 before opening night. And remember: you haven’t earned a penny yet.
Fixed Monthly Costs – The Bills That Never Stop
Upfront costs might hurt, but it’s the recurring bills that decide whether your pub survives past year one. Here’s what you’ll be paying every single month in 2025:
Rent
- Range: £20,000–£80,000 per year (£1,600–£6,600 per month).
- Factors: Location, pub size, pubco vs independent.
- Pubco twist: Some pubcos reduce base rent but make it up with inflated tied beer prices.
- Freehold owners: Escape rent, but mortgage payments and full maintenance hit instead.
⚠️ Landlord warning: One tied landlord in Surrey shared on X that rent hikes wiped out his profit despite strong trade. Always cap rent increases to RPI in negotiations.
Business Rates
- Average: £15,000–£25,000 annually.
- Relief: 40% business rates relief extended until March 2026, but many pubs still face hikes.
- Impact: BBPA estimates pubs need to sell 60,000 extra pints annually just to cover the latest rates and NIC increases.
Utilities (Energy, Water, Waste)
- Energy costs: Still 80–200% higher than pre-crisis.
- Water: £1,000–£2,000 annually.
- Waste disposal: £500–£2,000 depending on food service.
Pub forums are full of horror stories: one Bristol landlord’s energy bill doubled to £4,000/month, nearly bankrupting his tied tenancy.
Insurance & Compliance
- Insurance: £1,500–£3,000 annually for public liability, building, and employer’s liability.
- Compliance checks: Fire safety, gas safety, electrical inspections add £500–£2,000 annually.
👉 Bottom line: even before wages and stock, most pubs face £5,000–£15,000 per month in unavoidable costs. If your local can’t reliably pull in £5k–£10k weekly trade, you’ll struggle to break even.
Staffing Costs – Your Biggest Expense
If beer is the lifeblood of a pub, staff are its heartbeat. Without good bar staff, chefs, and cleaners, your pub won’t function. But in 2025, staffing has become the single biggest running cost for most landlords.
Minimum Wage 2025
- The UK National Minimum Wage in 2025 is £12.21 per hour.
- Add in National Insurance contributions and pension contributions, and the real cost to the landlord per hour can reach £14–£15.
⚠️ What this means: a full-time staff member (40 hours/week) costs £30,000+ annually before bonuses or overtime.
Typical Pub Staffing Model
- Small wet-led pub: 1 landlord + 2–3 part-time staff.
- Medium pub with food: 2–3 full-time (chef, manager, bar lead) + 6–10 part-time.
- Large gastro or event pub: 5+ full-time + 15+ part-time.
Average annual staffing cost:
👉 £50,000–£100,000 depending on size and service model.
Hidden Staff Costs
- National Insurance Contributions (NICs): Add ~13.8% on top of wages.
- Pensions: Auto-enrolment required, ~3% employer contribution.
- Training: Mandatory food hygiene, first aid, cellar management. £200–£1,000+ annually.
- Turnover costs: Hospitality churn is brutal — replacing a single employee can cost £2,000+ in lost training, recruitment, and mistakes.
Real Landlord Stories
- Quiz-night pub in Devon: landlord cut wages by cross-training bar staff to also handle food orders, saving £20k annually.
- Gastropub in Manchester: had to close midweek lunches because staff costs outweighed takings — better to stay shut than lose money.
- Managed site in Leeds: staff costs covered by pubco, but pressure to hit sales targets was “relentless.”
👉 Lesson? Staff make or break your pub. Too many, and you bleed money. Too few, and service collapses (taking your reviews down with it).
💡 Pro tip: Automate what you can. SmartPubTools doesn’t replace staff — but it saves staff time by generating ready-to-post social media campaigns, posters, and event promos in seconds. More time pouring pints, less time chasing Canva.
👉 Try it free at SmartPubTools.net.
Stock & Supplies – Beer, Food, and Entertainment
You can’t run a pub without stock. But in 2025, the price of filling your cellar and keeping punters fed has climbed — and if you’re tied to a pubco, you’re paying through the nose.
The Beer Tie Problem
- Markup: 30–50% above wholesale prices.
- Reality: A tied tenant might pay £140 for a keg of lager that a freehouse could buy for £90.
- Impact: Over the course of a year, that difference can add up to tens of thousands of pounds in lost margin.
⚠️ Landlord story (Reddit): “I sell more beer than ever, but I make less profit because my tied prices keep going up.”
Food Supplies
- Inflation: Up 15% year-on-year in 2025.
- Average food costs:
- Roast chicken portion: £2.50 → £3.10.
- Beef joints up 20% since 2020.
- Fryer oil now £25+ a tub.
- Challenge: Balancing food prices without scaring off customers. Many landlords report that food margins are healthy (55–65% GP), but only if staffing and waste are tightly controlled.
Entertainment Licences
- PRS for Music + PPL: £400–£1,000+ annually depending on size and music use.
- TV licence (for sports): £159 basic + Sky/BT sports packages (£400–£1,500 per month).
- Hidden extras:
- Pub quiz packs, karaoke software, sports projector upkeep.
- Bands/DJs can cost £100–£500 per night.
Seasonal Spikes
- Christmas: Stock bill can double in December.
- Summer beer gardens: Higher draught demand + cooling costs.
- Sporting events: Euros/World Cup = extra kegs + marketing spend.
The Brutal Maths
- Wet-led pubs: 20–30% gross profit margins.
- Food-led pubs: 55–65% GP (but higher staffing).
- Event-led pubs: Unpredictable, but can double turnover on the right night.
Stat: For every £3 spent in a pub, only £1 is profit. The other £2 is swallowed by tax, rent, stock, staff, and bills.
👉 The takeaway? Stock is expensive, ties are restrictive, and entertainment licences keep piling on. But without them, you don’t have a pub — you have an empty shell. The trick is squeezing more value from what you’re already paying for.
💡 That’s where SmartPubTools.net helps — if you’re paying for Sky Sports or karaoke, you need punters to show up. Our tool turns “England vs Wales tonight” into banter-filled posts that get customers through the door.
Profit Margins – The Brutal Maths
Every landlord dreams of a packed bar and money flowing faster than the beer taps. The reality? Even busy pubs can make frighteningly little profit. Here’s why.
Wet-Led Pubs (Beer-Heavy)
- Gross profit margins: 20–30%.
- Why so low? Beer tie markups, tax, wastage.
- Example: A pint selling at £5 might only leave £1.20–£1.50 profit after VAT, duty, and supplier costs.
- Risk: Relying only on wet sales leaves pubs vulnerable to duty rises and drinking trends (more moderation, less volume).
Food-Led Pubs
- Gross profit margins: 55–65%.
- Upside: Food adds value, increases dwell time, and drives higher spend per head.
- Downside: Higher staffing (chefs, waiters), food waste, and rising supply costs.
- Example: A £12 roast dinner might cost £4.50 in ingredients, leaving £7.50 gross profit — but only if you’re not overstaffed or under-booked.
Event-Led Pubs
- Margins: Wildly variable, but huge upside.
- Quiz nights: Often double Tuesday takings.
- Match days: Can double or triple weekend sales (but risk running dry).
- Karaoke/live music: £100–£500 investment for DJ/band → can pull £2k+ extra bar sales.
- Downside: Reliant on consistent promotion.
The £3 Rule of Pubs
According to BBPA and UKHospitality stats:
👉 For every £3 spent in a pub, only £1 remains as profit.
The other £2 disappears into:
- Taxes & duties
- Rent & rates
- Staff wages
- Stock & utilities
This rule explains why so many pubs that “look busy” still close — high turnover doesn’t equal high profit.
Landlord Stories
- Busy but broke: A Birmingham pub pulled in £400k turnover in 2024 but made only £18k net profit because of beer tie costs.
- Food-led winner: A Yorkshire freehouse with a strong roast and quiz trade hit £65k net profit on £350k turnover.
- Events-led survivor: A Manchester site kept afloat only by Euros football screenings, adding £50k seasonal turnover.
👉 What separates winners from losers isn’t the pint pour. It’s the strategy: diversifying income and keeping punters coming back. That’s where SmartPubTools.net earns its keep — making sure your events, roasts, and match days don’t go unnoticed online.
Hidden & Overlooked Costs
It’s easy to budget for rent, rates, and beer. But it’s the surprise bills that often tip landlords over the edge. These aren’t the glamorous side of running a pub, but they’re just as real as your Friday night rush.
Repairs & Maintenance
- Structural issues: Roof leaks, dodgy wiring, ancient plumbing.
- Pubco leases: Beware of “full repairing leases” that leave you liable for costly structural fixes.
- Typical costs: £5k–£50k annually depending on age of building.
⚠️ Horror story: One landlord in Manchester signed a lease and was hit with a £50k roof repair bill in year one.
Marketing Spend
- Posters, chalkboards, and local ads can add £500–£2,000 annually.
- Paid social ads: £100–£500 per campaign (if you know what you’re doing).
- Time cost: Many landlords spend 5–10 hours per week trying to write posts, often with little engagement.
💡 This is why tools like SmartPubTools.net exist — turn 5 words (“Quiz Night Tuesday 7pm”) into posters, social posts, and event promos in seconds. No wasted time, no extra ad budget.
Legal & Accountancy Fees
- Solicitors (leases, disputes): £500–£5,000 annually.
- Accountants (payroll, VAT, tax returns): £1,000–£3,000 annually.
- Licensing renewals & compliance costs.
Personal Toll (Time, Stress & Family)
- Hours: 60–80 hour weeks are standard.
- Mental health: 40% of landlords report stress, anxiety, or burnout (UKHospitality, 2025).
- Family: Living above the pub means work-life lines blur. Many landlords see less of their kids than they did in a 9–5 job.
👉 The harsh truth: even if you plan well, unexpected bills will come. The only way to survive is by building enough margin into your business — and keeping your pub busy enough that those costs don’t cripple you.