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| Who
owns the pubs? |
There are some 30,000
leased or tenanted pubs in the U.K.
Over three quarters belong to just ten companies three of which
are breweries, the others are known as Pubco’s. To simplify
we will use the term Pubco to describe any company that owns pubs.
This “Top Ten” (by number only!) evolved from the buying
and selling of pubs through mergers and acquisitions of companies
as a result of legislation introduced in 1979. During this time
many leased pubs have been sold from Pubco to Pubco three or more
times. Changes of tenants in these pubs have often been considerably
greater.
We will help you get to know about the Pubco's.
The style of management and funding of Pubcos varies. Be sure of
the details of the terms of the lease or agreement, especially with
regard to rents, rent reviews, insurance, tie, and share of income
from coin-operated machines. We Investigate your responsibilities
for repairs to the property and details of all other additional
charges that will be made by the Pubco.
The “Best” Pubcos have thorough application processes,
that will involve independent advice.
“A pub is just a building without good licensees”.
They will look for, suitability to hold a licence, adequate funding,
personality, experience and training.
You can judge a Pubco by the standard of its application process.
Remember they receive thousands of applications, from the highly
funded and experienced, to the no hopers. The majority of applicants
never get an interview or meet a management person. Because of lack
of knowledge and preparation and not seeking our advice and services.
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 other companies asking for cash up front sometimes
£000’s to train you to run a pub and to find you “the
pub of your dreams”.
There is no easy way in! What you need to know.
About you, are you for the pub trade?
Remember 60% of new licensees fail!
Have you and your partner had experience of:
1. Running a business and working for yourself
2. Spending all day every day being and working together.
3. Working in pubs and managing people.
Details of the pub?
The Property
The “Agreement” by which the property is let. (The Tenure)
Is it lease, tied lease, tied Lease assignment, tenancy, freehold?
Details of the supply agreement. (brand choice etc.)
We specialist in giving 'Industry' advice in this area and if required
organising independet legal advice.
How much capital is needed?
We agree with the better operators’ requirement of a minimum
£15,000. This would be for a basic tenancy or new lease. It
must be available in cash and not subject to loan repayments.
Profit or loss? It’s a business!
How to “Test” a pub for profitability.
The total turnover must produce enough gross profit to cover all
the running costs of the pub plus a basic income for the licensee
and family.
Always calculate the “Break-even”.
Develop a Professional Business Plan. (A Major
part of our business comes from this area)
Not just for getting in to the pub. This is the basis on which you
will develop and grow your business. To be reviewed at least once
a quarter, preferably with our advice. The vast majority of pub
Business Plans never see the light of day after moving in day.
Misconceptions.
Real quotes from applicants in interviews for taking a pub.
"I’ve been using pubs all my life so there’s not
much I don’t know about them. I was bought up in the trade,
my mum and dad ran pubs for years".
"I can make a go of the “Dog and Duck” because
it’s near to where I live. All our friends will come to see
us. My wife is a great cook all our friends say she should have
her own restaurant so catering is no problem. The Accountant will
look after all the finances and that. I’ve got a mate with
a pub and I’m going round there on Sunday morning for a couple
of hours so that he can show me the ropes like cleaning beer pipes.
Living on the premises will make things so much easier than having
to go out to work every morning. It’ll be work and social
life all in one. The kids are all up for it and can’t wait
for us to move in."
The Reality.
Quotes of a successful licensee
We start work around 7.30 a.m. on most days. We don’t take
a full day off because living over the shop your always finding
things to do. The day is full of routine things, cleaning, stocking
up, food prep, cellar work, accounts, banking, cash and carry, and
that’s as well as opening, the pub it just never stops. The
burglar alarms went off at 3 o’clock this morning and the
police came round I got back to bed at 4.00.
We only get a proper break when we go away on holiday, but then
you tend to worry about what’s happening while your not there.
That’s where mobile phones have helped, I keep it with me
all the time just in case. I wouldn’t call it hard work but
it can be 12/14 hour days with no social life and months without
any proper time off but I can’t imagine doing anything else
it’s my life and I love it.
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