Increases to the minimum wage and employers National Insurance contributions will see an extra £1 million in costs for the House of Bruar, its managing director has said.
The popular Highland Perthshire company enjoyed a record year in 2024, with footfall and turnover both up significantly compare to 2023.
And more than 350 people are employed with the firm, which has an award winning shop just off the A9 near Blair Atholl and a direct shopping and distribution centre in Ballinluig.
Specialising in country clothing and outdoor wear, the House of Bruar also hosts a well-loved food hall and restaurant.
The House of Bruar recorded pre-tax profits of £3.25 million to February 2024, annual accounts show.
This is an increase of more than 11% on 2023.
Turnover also increased on the year before, up from £39.1m in 2023 to £44.75m to February 2024.
Wage costs increase at the House of Bruar
Managing director Patrick Birkbeck said sales exceeded £53m in the past 12 months as the business has continued to grow.
However, he has warned of a significant financial headwind with the introduction of a higher national living wage and the threshold for employer’s National Insurance contributions falling from £9,100 to £5,000 from April.
Mr Birkbeck estimates this will add at least £1m to its costs.
He explained how offering salaries up to 15% higher than the living wage was one of the ways they attracted staff to work for the rural business.
Recruiting for a company far removed from larger population areas is a pressing issue for the House of Bruar, and has been for some time.
“We pay above the living wage, which is for new, entry level recruits,” he said.
“But if you’ve been with us for five years and are above entry level, its more than 15% above the living wage.
“So the increase hits across the whole board. And across 350 people, that’s a big increase.
“Recruiting to our rural business has not gotten any easier.
“And when you look at the difficulties of recruiting, it forces us down the route of automation. But you then get to thinking, how do we automate the shop floor?
“So what we have to do is improve our automation and digital and IT support to allow whoever is on the floor to sell, and not kept doing other jobs.
“The downside to that is we are not recruiting more people. Automation is stopping the recruitment of more people, but not reducing the headcount.”
2 million House of Bruar visitors in 2024
More than 2m people visited House of Bruar in 2024.
Asked what kept people coming through the door, Patrick said: “I think overseas tourism has made a significant difference this year.
“And we have to consider the weather, too. We had a pretty inclement summer and when the weather is bad, people go shopping.”
Direct shopping channels grew by 25% during 2024, Patrick said, with significant increases coming from trade in the US. This is in part, he added, to a demand for products like Harris Tweed and other Scottish-made items.
Orders made through catalogues and the website now account for more than half of the company’s turnover.
But President Donald Trump’s ongoing trade wars and his seemingly sporadic use of tariffs has left a degree of unpredictability.
“The American market has grown hugely. But it is still only 16% of the direct shopping business. And it does continue to grow quickly,” Patrick added.
“We have to keep an eye on developments in the US.
“There is not a lot we can do about it, but you have to hope Donald Trump’s strong affiliation with Scotland means he will try and help (the Scottish economy).
“But who knows, we are trying to make plans for what he is going to do.”
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