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| Facts for Starters |
The majority of Public Houses available to rent are Tenancies or Leases.
Who owns the leased / tenanted pubs?
Of the 30,000 leased or tenanted pubs in the U.K. the majority are owned by a small number of large companies known as Pubcos’. There are also a number of regional/local breweries with tenanted Public Houses known as “Tied Estate”.
Get to know the facts about the Pubco.
“A pub is just a building without good licensees”
The style of management and funding of Pubcos varies considerably.
You must be clear of the details of the terms of their lease or agreement, especially with regard to rents, rent reviews, insurance, beer and product tie, and any share of income from coin-operated machines (pool tables etc.). You must also be aware of your responsibilities for repairs to the property and details of any other charges for which you will be responsible.
The “Best” Pubcos have extremely thorough application processes. The Pubco should demonstrate an in-depth process to establish that you have adequate funding and have the necessary personality, training and experience to operate and develop the business. Unless you are experienced licensees or have other business experience, beware of an over enthusiastic Pubco.
Other Pub Operators.
There are many reputable companies that operate pubs often on a temporary basis on behalf of Pubcos. Known as Holding Companies or Agencies they play an important role in the operation of leased estates. However there are companies asking for cash up front to train you to run a pub and to find you “the pub of your dreams”.
Beware!
There is no successful quick and easy way in to the licensed trade for beginners.Develop a Business Plan.
This is not just as part of an application for getting in to a pub, but is the basis on which you will develop and grow your business for the future. |
The Acid Test. “What is the Break Even?”
Can you make the pub pay?
“The total turnover of any pub must produce enough Gross Profit to cover all of its running costs plus a suitable income for you and cover all of your personal expenses”.
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Always Calculate the
“Break Even”! |
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