Monday, February 06, 2012

Working all the hours for none of the rights at Enterprise Inns

Good for you Nick Sommerlad - The Tie is a scam, a means for usurious landlords to asset strip Britain's unique heritage and blame their tenants and the government for all the pub failures while they make £hundreds of millions doing it.

The various accounts of contributors above are accurate and reflect the pretty much ubiquitous experience of tied publicans in Britain who are sole trader.

For readers who don't know the pub business it should be pointed out that Enterprise Inns are not alone in doing this to their lessees -

- All pubcos behave the same way. Punch Taverns; Greene King; Scottish & Newcastle (S&NPC); Marston's; Admiral and most, if not all, of the smaller 'Family Brewers' who run tied estates are exactly alike. There is not a hair's breadth of difference between them in their shenanigans of applying the pubco scam to all lessees.

There are lessees who make a living out of their pubs but these are only the busiest pubs who are able to survive the ravages of the tie and even so their profit margins are derisory compared to the free of tie market where publicans buy beer for half the price of tied pubs and whose rents are on par, if not less than, tied leases.

My pub, The Sun and Doves in Camberwell, London SE5, was with S&NPC. I was evicted in September 2011 and bankrupted in October. This has happened to thousands of publicans over the last two decades whose businesses failed and who left their pubs - only for new lessees to take over, invest substantial amounts in the process, subsequently to go the same way. This turnover of lessees is called 'Churn' in the pub industry and their investment from the outside is the only substantial money that has been spent on tied estates since the pubcos were invented following the Beer Orders of the late 80's.

The failure of my award winning and busy pub was inevitable from the day I signed my lease in 1995, and invested £75K turning a run down boozer into one of London's highest profile and busiest pubs sixteen years ago.

I was evicted for non payment of a gigantic back rent bill amassed from my 2005 rent review which took six years to resolve, finally against me, in a case which is not really that unusual overall - it just took a lot longer to put me out of business than most lessee's rent reviews do because it got stuck in arbitration and high court.

It's simple: The Tie is used by unscrupulous landlords to extract as much profit as possible from tenants who then cannot invest in their businesses which leaves tied pubs suffering chronic underinvestment which has led to a spiral of decline in custom, income and function right across the pub sector as customers abandoned smelly boozers in favour of Starbucks and chain pubs such as All Bar One who do not suffer from underinvestment.

It's a long, bitter and shockingly miserable story of decline of a great tradition which has been having a serious adverse impact on communities all over the UK that's been tucked away by pubcos while they steal the nation's heritage bit by bit until individual pubs fail - and then are sold off for private development as Tesco Extras, Bookies and for conversion or demolition to make way for residential.

The pubcos say they're getting more and more interest in their tied leases. IF this is true it's because the pubcos and the British Beer and Pub Association which represents them - tells people that tied pubs are a 'fantastic low cost entry into running your own business'. This is disingenuous since signing a tied lease actually harms your financial, mental and physical health.

IF you've experienced pub closure and want to do something about it; soon you will be able to invest into pubs in a cooperative model pub company run like the John Lewis Partnership: look out for the PEOPLE'S PUB PARTNERSHIP setting up soon. It will buy freehold pubs that have been cast off by the pubcos through decades of putting tenants out of business then refurbish them to the highest environmental standards so they have a very low carbon footprint and are very comfortable and attractive from a customer's point of view. They will use local supply chains and brew their own beers. They will put pubs at the heart of the community again.

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