Monday, February 25, 2008

Shorter letter to watchdog

Why do publicans in the UK spend £1.19 wholesale on a bottle of Beck’s bought from their landlord when they could get it at a supermarket for 49p?

PubCo leases oblige tenants to buy beer and other products through the PubCo at prices set by the PubCo. The ostensible reason for the PubCo charging a premium price for beer is that the rent on the pubs is cheap. This is not so. PubCos have been extremely aggressive at rent reviews and have consistently put up beer prices faster than inflation for over a decade. They have systematically removed profit from the tenant’s (lessee) P&L and transferred it to the PubCo’s.

Radio 4's You and Yours had a slot on Friday 8 February called 'is there a future in running a pub?' I listened and was disappointed that the programme swayed heavily in favour of suggesting that, in spite of a dreadful 2007 summer and the impact of the smoking ban, this noble industry has a lot of mileage in it yet for the entrepreneurial, hard working, bright publican who has a business head and relishes being self employed doing a pub their own way.

The reality is very different. Please look at this thread on the Morning Advertiser website for a flavour of what is wrong.

I own The Sun and Doves, an award winning pub in Camberwell SE5. When I signed the lease it was a dead quiet, sticky floored boozer with leaded lights, an eternally empty pool room, a pink disco lounge bar and a threadbare garden. They served deep fried sausages and packet potato mash for lunch. I spent £150K of my own money turning it into one of Britain’s first ‘Gastro Pubs’ and have spent the last thirteen years learning about the scandalous behaviour of Britain's Pub Companies the hard way - by becoming one of their unwittingly bonded slaves. Please give me a chance to explain more. You will be amazed. Thanks. Mark Dodds.

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