These prices can be in the region of 50% higher than a free of tie pub would pay. Combined with unrealistic rent levels (which also impact on local authority business rates) this means the average patron can pay in the region of £3.50/£4.00 per pint!
This question has been asked an immeasurable number of times over the century’s. However with the battering this ancient industry has taken over the last few years, I begin to wonder whether there will be any pubs left to enable me to do so soon.
With the number of pubs closing on a weekly basis increasing from around 12 in 2011/12 to approximately 18 in 2012/13, you begin to wonder if there are any left even now!
The government has recently announced it will be appointing an independent adjudicator to review what appears to be the main issue. This issue is pub companies (accounting for around 50% of tenanted pubs) who dictate where landlords have to purchase their beer, at what price and which products. These prices can be in the region of 50% higher than a free of tie pub would pay. Combined with unrealistic rent levels (which also impact on local authority business rates) this means the average patron can pay in the region of £3.50/£4.00 per pint!
With cash flow being so tight, landlords and landlady’s are also running afoul of HMRC for PAYE and VAT. A constant that I come across regularly in my capacity as consultant when dealing with clients in the pub sector. Sometimes they are at the stage when a Bankruptcy Petition has been sent.
All these problems meant customers have started to change their drinking habits, it will take major changes within the industry to entice them back. This announcement by the government is a big step in the right direction. Hopefully, along with further help, it will allow the pub industry to start down the road to recovery. This help may even be required within the supplier side as well. As the demise of a long established Soft Drinks and Spirits Provider in the Chesterfield area attests too.
I’d say we at Wilson Field are well positioned to offer support, with professional advice and schemes that allow pubs to dictate their own destinies. Procedures such as Individual Voluntary Arrangements (IVA) for individuals and Company Voluntary Arrangements (CVA) for Limited Companies, appear to help make their future more and more secure.
I would love to see the pub industry flourish again. Not only because I like a good pint (I do!) but also because of my previous career as an Account Manager for John Smiths. You could say it’s in my blood!
By: Steve Brown – Wilson Field