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Tuesday, July 08, 2008

FOOD LED VS WET LED & PUBCO P&L'S

There's an irony about food led, since you make that point, which the PubCos RICS and all conveniently don't acknowledge. A business that is food led has MUCH higher overheads on wages and salaries than one which is wet led. THEY typically expect a 20% wages bill (or less) on any pub business when, if food led, it should be 30% - 35%. Why would a profit & loss projection produced by a PubCo for a food led tied pub rent review have a wages bill of 20% net turnover when, in reality it's impossible for the business to make and serve that food unless the wages bill is 33%? Go on. WHY? Because the difference makes a greater profit on the PubCos' P&L and they want half of that in their shareholders' bank accounts.

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