A Dublin cafe owner says the challenges of trading at a time of high electricity bills, an increased VAT rate and rising staff costs have been exacerbated by November’s riot in the city, “the final nail in the coffin”.
Will Monaghan, owner of One Society on Gardiner Street, said the last 11 weeks have been “the worst weeks we’ve had in two years”. He opened the business five years ago.
Restaurant owners have warned of a “crisis point” being reached in their sector after two stop-start years during the Covid-19 pandemic were followed by huge increase in energy bills after war broke out in Ukraine.
The hospitality VAT rate also has risen from a reduced level of 9 per cent back to 13.5 per cent, pushing up prices at a time when customers face a cost-of-living crisis.
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A deadline for warehoused taxes – due to fall on May 1st, dating back to the Covid-era – has also been highlighted as putting an extra strain on cafes and restaurants. The Government last week indicated it was considering making changes to the scheme to help ease strain on affected businesses.
One Society offers brunch during the day and operates as an Italian tapas and wine bar at night.
When the pandemic began, Mr Monaghan said, things got difficult but State subsidies were “really strong and kept a lot of businesses afloat, including us”.
“Then it got really tough from the start of the Ukraine war, because like everyone and every other business, costs started to spiral and there was no predicting where anything was going next,” he added. “Those costs have come down, albeit a little bit, but they haven’t gone back to where they were and they never will in my opinion.”
The financial year to last February saw the business experience “record” sales, up 15 per cent on the previous 12 months, but it made a €50,000 loss, which posed “a massive problem”, Mr Monaghan said.
“We either close our night time business or we try and reinvent ourselves which we did, so we reinvented into an Italian tapas and wine bar at night, and straight away it started performing,” he said.
“After nine months up to November just gone, we were looking quite strong and we looked like we’d turned around that €50,000 loss into a profit-making situation, which was incredible.”
However, the Dublin riots then erupted on November 23rd, just before Christmas and only a stone’s throw from One Society. He said the area has “undoubtedly” been quieter since.
“If you stood in the middle of the crossroads [where the business is located] the night of the riots, you would have seen the Garda car on fire,” he said.
“Unfortunately the riots meant we were a no-go area. We had a few Christmas bookings cancelled, which was understandable. We weren’t able to recover and find business elsewhere because nobody wanted to come here.
“We were getting phone calls from people down the country asking if it’s safe, and we said: ‘Yes it’s safe, there’s an eerie feeling about it, but the streets are the way they were.’ But the perception unfortunately is the reality,” Mr Monaghan said.
“If the perception of the area is dodgy to dangerous in the evening, that’s why we’re suffering so bad and that is not going to improve with the tourist season.”
Before he opened the business five years ago, Mr Monaghan said people told him “you’re mad” but his view was that the north inner city was “up and coming, there’s a lot of positivity, it’s not a dangerous place, and it wasn’t and I actually stand over that”.
“Businesses trusted what the Government said about regeneration, building up Mountjoy Square, and we put a lot of money into betting on the area, that it would come good and it has come good, but it’s now just been completely shot in the foot.”
He is quick to say he does not like giving out as there is a lot to be positive about his business – five years of trading, great staff and great customers.
Asked what can be done to help improve things, he said more gardaí, a further reduced VAT rate for cafes and restaurants, and investment on O’Connell Street.
“Since the riots, I’d be in the restaurant eight hours-plus a day, and I’ve probably only seen 10 Garda jackets going by since then... the public need to see it to feel comfortable,” he said.
“If you go to any big city in the world, you’re drawn to the main street because it’s something you want to see, eg, the Champs-Élysées in Paris, Las Ramblas in Barcelona.
“Whereas you go to O’Connell Street and you just want to get through it and get out of there as quick as you can. You’re supposed to marvel at the spectacle of a main street rather than scurry down, on edge, trying to get away from it.” – PA
