A holiday resort boss has vowed to keep the seaside chain’s “value for money” ethos, but warned it is getting harder to keep prices down amid rising costs
The head of Butlin’s has issued a warning about the struggle to keep prices low, highlighting a rise in costs as the cause behind 250 proposed job cuts. Jon Hendry Pickup pledged to uphold the resort chain’s “value for money” approach, a cornerstone since founder Billy Butlin launched his first holiday camp 90 years ago this month.
However, he conceded that escalating costs, coupled with potential repercussions from the Middle East conflict, were making it increasingly challenging.
He also cautioned that a mooted “tourist tax” could result in the drastic measure of shutting resorts down for extended periods during term time, impacting parents with young children who can secure four-night breaks from just £39.
Mr Hendry Pickup spoke as Butlin’s commemorates the inauguration of its first site in Skegness in April 1936. It provided three meals a day for a week, along with entertainment, for £2.25 per person. This gave rise to what would become a British seaside institution, boasting 10 coastal camps at its zenith.
The home of Redcoats’ winning blend of fun-filled activities – including knobbly knees and glamorous granny competitions – and affordable rates made it popular with generations.
However, the advent of budget foreign holidays took a toll, leading to a series of closures, leaving Butlin’s with just three resorts: Skegness, Minehead, and Bognor Regis.
In many respects, Butlin’s is a far cry from its nostalgic past, having seen significant investment in new accommodation and facilities. But Mr Hendry Pickup insists its charm has endured unchanged.
Speaking to the Mirror, he said: “People are out there having fun, they’re doing things non stop. Some parents say it feels like ‘we get home and we need a rest’. And that’s completely fine. You can see it with the kids.
“The young ones are straight into it. The one who are into their teens can be a bit cool about things but within a short period of time they are getting involved.”
In an era where youngsters – and grown-ups – remain fixated on their smartphones and social media platforms, he maintains he aims to provide families with incentives to set them aside and share quality time together.
He said: “There will be times when people sit down and check their Instagram, that type of stuff, but you don’t see it very much. You see very few people heads down, earphones on, doing their thing.
“If everyone was doing that the whole time, it would feel like a fail on our part. But actually we’re giving them loads of things to do so they’re doing other things.”
Butlin’s summer reservations are running 2 per cent higher than the previous year and might receive an additional domestic holiday surge should rocketing aviation fuel costs push up overseas trip expenses.
Travel companies, including carriers, frequently raise their tariffs during periods of high demand. Might this occur at Butlin’s should families abandon international getaways?
Mr Hendry Pickup said: “Not inevitably but there is a chance.” He highlighted February half-term when sluggish demand caused prices to drop.
A major hurdle for Butlin’s, similar to numerous hospitality businesses, involves increases in employer’s national insurance and minimum wage rates, which have imposed £10million in additional expenses. The company’s business rates liability is also set to double by 2028, creating another £3million burden.
Mr Hendry Pickup said: “The costs are pretty relentless,” revealing the firm had started discussions to eliminate 250 positions, roughly 7 per cent of its staff. The reductions are “entirely linked to these cost increases,” he said.
“The costs are going up every year, that’s for sure. What’s not certain is whether guests will have more money to spend every year.”
Butlin’s expects to greet 1.5 million guests this year, mirroring last year’s figures but marking a 25 per cent increase from 2019.
Occupancy rates hover around 80 per cent to 81 per cent throughout the year, even during closed periods, bolstered by its wildly successful adult-only Big Weekenders.
Mr Hendry Pickup believes that offering a comprehensive package for a single price, inclusive of entertainment and optional food and drink add-ons, assists customers grappling with the cost of living.
However, he cautioned that these could become unaffordable if proposals for a ‘tourist tax’ are implemented.
The government is considering allowing regional mayors in England to impose a “visitor levy” on overnight stays, a practice already in place in certain European countries.
Industry leaders argue that even a modest £2 or £3 per person tax over a week could significantly impact budget-conscious families.
Mr Hendry Pickup said: “Let’s be clear on what this is, it’s a UK tax for people travelling in the UK. It hits people who travel and come to us. The people it hits most are the least affluent.”
Those backing the tourist tax argue it would generate revenue for the local community, to which he responded: “It will do if we are open, but if we’re not open because we are not viable then it takes away all the money that currently comes in.”
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