How is surge pricing affecting hospitality and other industries?

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How is surge pricing affecting our pubs? Well, according to the BBC, one particular pub in central London has been accused of charging customers an extra £2 a pint after 10pm.

Transcript

00:00It was reported that in 2023, Britain's largest pub group, Stonegate Group, which owns chains

00:08like Slug & Lettuce and Yeatsies, said it was raising prices by 20p at 800 of its venues

00:14during peak times. The company then said that busier pubs incur extra costs, with more bar

00:19staff and bouncers needed. Back in 2023, when discussing the Stonegate news, the Campaign

00:24for Real Ale CEO, Tom Stainer, said, quote, we know pubs and brewers are having a difficult

00:29time at the moment, but we don't think an extra charge penalising customers that want

00:34to support the industry is the right solution. He went on to say that our fear is that it

00:38could convince people to stay away. Interestingly, consumer rights expert Scott Dixon also reportedly

00:44told The Telegraph that, quote, the hospitality industry needs to rethink their business model

00:49instead of inventing new ways to rip people off. There needs to be more transparency.

00:54He then added, quote, their pricing policies are underhanded and consumers are being misled

00:58into buying decisions they would not otherwise have made. Now, recently, many industries

01:03have been using dynamic pricing to increase fares during busy periods. One example of

01:08this is how Uber's surge pricing often kicks in when there aren't enough drivers on the

01:13road to fulfil the number of taxi requests. Furthermore, in a survey conducted by Barclays

01:18last year, close to half of UK shoppers said they'd noticed more examples of surge pricing.

01:24It was also found that one in three had seen an increase in the price of food and drink

01:29in pubs and bars during peak times. Merlin Entertainments, which owns places like Alton

01:34Towers in Legoland, announced plans earlier this year to increase prices on busy days

01:39across 20 of its global venues. Merlin Entertainments said it plans to use AI to determine price

01:45fluctuations, which it says reportedly helps avoid overcrowding during busy periods and

01:51as a result is hoped to, quote, protect the guest experience.

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