High street could become ‘ghost town’ in economic crisis, says cafe owner

CAVERSHAM could become a “ghost town” if independent businesses are forced to close due to the recession, claims a café owner.

Sam Smith, who owns The Collective in Church Road, was speaking after seeing her energy bills rise by almost 600 per cent from £5,000 to £34,500.

She said she worries about whether her business will survive and is considering keeping the café closed on some mornings as it would cost her less than opening.

Mrs Smith, 47, said: “It’s constantly on my mind and I have sleepless nights thinking about how we are going to find the money.

“We are constantly trying to find a solution but there isn’t one. We were a successful thriving business.

“Obviously we are going to try everything we can but at the end of the day, if there’s no money, there’s no money.

“Caversham is full of independent businesses and I think it could become a ghost town. We seem to be busier than most places in Caversham so if we’re likely to go bust then I think everyone is.”

The Collective, which serves coffees, brunch and pastries from local artisan bakeries, opened more than two years ago.

It was Mrs Smith’s second shot at owning a café, having previously run a café bar in Crystal Palace.

She sold that business in 2019 and moved out of London with her husband and three children.

They settled in St Anne’s Road, just a few hundred yards from where The Collective, then a corner shop, now stands. Mrs Smith said: “I was doing part-time work looking for something and we saw an opportunity and went for it.”

She took over the lease in December 2019 and refurbished the premises before opening the café in June 2020.

Mrs Smith said: “We opened at the start of covid, which was obviously frustrating with lots of staff sickness, changing hours and issues with people in or not.

“We invested a lot of money in the business and had a garden that we put a structure in so people could sit outside. That cost quite a lot of money and we still have start-up loans that we’re paying back.”

The café was successful despite the pandemic, turning a profit and winning the best café in Berkshire award from Muddy Stilettos in consecutive years.

When food prices rose earlier this year, Mrs Smith was forced to increase her prices by seven per cent to offset the higher costs.

She said: “We felt that was as much as someone would pay for a coffee before they go home and make it themselves.

“We were really depleted and not making much money but riding it. Then the energy bills came.”

Mrs Smith’s energy bill last October was £5,000 after VAT but she left her contract with Octopus Energy earlier this year to look for a better price.

However, she said many suppliers would not even give her a quote. “They’re not touching hospitality,” she said. “I looked on GoCompare for a quote and they stopped halfway through when I told them it was for a café.”

She decided to stay with Octopus and was offered a 12-month fixed contract at £34,500, including VAT.

She has chosen not to accept this but is now unsure how she will pay for her energy.

She said: “I can’t sign up to the new tariff because we can’t afford it. It would be like taking out a loan that you can’t pay back.”

She conserves energy by turning off the café lights when they’re not needed, has blocked the plug sockets to stop customers charging their phones and laptops and is getting rid of the gelato freezer.

Mrs Smith believes she will have to do more to save energy when winter comes.

She said: “We’ll have to stop the wi-fi because we just can’t afford to become a workspace for people who will want to leave their homes and come somewhere a bit warmer.

“We have heaters in the garden which were great through lockdown but we’re not going to switch those on until at least November.”

Mrs Smith has even had to consider laying off staff.

She said: “We have 17 people who work here, from Saturday jobs to full-timers, and it’s a worry because I won’t be able to pay them.

“I had someone apply for a job who had worked in a café around the corner and was let go because of the cost of energy.”

Mrs Smith believes the only way independent businesses can survive is with help from the Government. She said: “I’m just living in the hope that they will do something to help, whether its lowering the VAT or capping bills.

“The concept of no longer owning the café is terrifying. What would happen to it — would it just sit empty or would someone else take it over? It’s awful.”

Other independent business owners in Caversham are also worried about spiralling energy costs.

Fourbears Books in Prospect Street has seen its bills jump by 50 per cent.

Owner Alex Forbes said: “I am very concerned coming into winter. We use heaters in the shop and I am nervous how much that will cost.”

Susie Jackson, who owns the Live Well gift shop in Prospect Street, said: “I have only had my summer bill so far but I am very mindful about how much things will change in the winter.

“We are going to have to do the simple things, like turning off lights, not having things running unnecessarily and wearing more jumpers.”

Reading East Labour MP Matt Rodda said: “I am very concerned about the energy crisis, especially as we move into winter.

“The effect on local businesses is going to be huge and I have been speaking to many of them myself.

“I have also been liaising with the energy providers to see if they can help with bills. They are already providing some help through their emergency fund but it is not ideal.

“Everyone deserves to have affordable bills. What we need is a change of government. Labour would freeze the energy price cap, which we would fund by extending the windfall tax.”