Monday, July 09, 2012

Thwaites Offering 400 Barrel Pub To Let

Not sure it's possible to link to this posting on Facebook 

Thwaites' particular way of operating the 'Tied Model' was brought into the company and refined by their former Managing Director, Peter Morris, a truly delightful man who I met on several occasions in my previous life as a self employed slave. Peter's one of the dinosaurs of the pub trade (there are many; still roaming the strange and primitive wilderness that is the British pubco landscape) who moved to Thwaites' some years ago from being Regional Operations Director at Scottish & Newcastle Pub Enterprises, a distinct step up the traditional English Courage, Grand Met, Whitbread old school bully boy ladder.

He chooses to describe himself in his LinkedIN profile thus: "Experienced director in pubs, hospitality and beer brands sectors".

I've had the privilege of meeting a lot of people (men, they are always men of course) JUST like Peter, men who share his charm, wit elegance and sharply focused understanding of the British pub trade - the people who have brought one of Britain's longest standing, most traditionally iconic and place defining institutions to its knees in a mere three decades' worth of dedicated asset stripping...

When Peter was appointed to head up Daniel Thwaites' plc to take it from being a 'Family Brewer' into a thrusting forward looking 21st century pubco practice clone he was reported in the trade press as saying 'the tied leased model works better for both parties than managed and tenanted operations because individual entrepreneurial publicans can achieve much better economies of scale than are possible with a company like Thwaites, it's situation that's win win for everyone concerned'... I paraphrase but it's pretty much what was printed at the time.

Peter talked Bollocks when he was ops director at S&NPE, Bollocks when he was MD at Thwaites and no doubt is still talking Bollocks about an industry he palpably knows very little about since he's been put out to graze in the last couple of years.


  1. Robert Sayles Mark - In your opinion is there any brewer pubco out there adopting an ethical approach to their business model or have they all jumped over to the other side?

  2. ‎Robert Sayles, That couple will NOT prove you wrong. UNless they make their pub do 75% + food and 20% wet that's fot wine, OR they do over 650 Barrels a year, I guarantee it.

    In near to 20 years I've never seen one example of a general, pretty good, operator with a tied pub lease making a success of it. The exceptions to the rule are two people who had tied leases where their impact on the business took the pubs from rubbish boozers to extraordinary cash generators doing 750 barrels + a year and I'd assert the only reason they survived is that even with dire margins they had such a massive amount of cash coming in they had enough left over after paying themselves and putting some aside for pensions and so on, to reinvest in their business to keep the premises attractive to new waves of customers as time passed by. Everyone else has gone tits up or is in penury.

    Once I signed a tied lease in 1995 and got into the business of being on the hamster wheel of trying to make a sensible profit out of a busy tied pub I always thought, having seen the true financial performance of my own busy, award winning pub:

    "it must be me who just doesn't know how to make a business work under these restrictions, plenty of other people setting up in tied pubs seem to be making OK out of it"

    but with time ALL, every single last one of these people who opened tied pubs after me, whose business skills, professionalism and flair I admired, and the people who had tied pubs before me who I consulted and asked advice before setting up my own pub, EVERY SINGLE LAST ONE OF THEM, went bust, failed, sold up before first rent review or have only just survived, telling me things like "we've never been more than two weeks away from bankruptcy" and "we only keep afloat by running 10% off the books and by buying in for functions or where we don't run it through the books so it can't be spotted by the pubco".

    I've seen COUNTLESS people set up tied lease businesses - either in London, my own area where I can follow them, or via the trade press, and thought:

    "THESE lot are going to prove me RIGHT it really IS just me that cannot make it work. AND lo and behold, between three and five years later they all went down the Swanee - while I was still trading. Yet I still felt like a failure of course. Then I'd see yet ANOTHER lot of professionals who seemed to really know what they were doing set up in the same failed premises and... what the hell, what a surprise, three years later THEY went out of business too.

    Oh, plus this: In all that time I've also seen several people do that magic 750 barrels a year and still go bust - but that is because they were so 'successful' they developed serious cocaine habits that affected their objectivity, made their businesses very rocky places to work in, and blew all of their surpluses up their nose as far as I could work out. Can't really blame the pubco's for that sort of silliness.

    The Beer Tie Kills Pubs: FACT

  3. Robert Sayles, They are like the Phoenix of the Golden Fleece, I've seen no evidence of any brewers / pubco's acting ethically or sustainably directly. If they really do exist they are on a statistically insignificant level but would be worth analysing, if possible, to see how what they do works against the manifestly paradigm failure that dominates the industry everywhere else.

    Robert Feale Martinez says Arkell's, somewhere West Country, are good. A couple of people have told me that Holts in Manchester do leases that are tenable, I've not seen figures to back this up and I've found no tenants prepared to step forward to prove the rule is wrong by their way of own example.

    Charles Wells and other Family Brewers assert that their own tied leases are great and they would never do rent and supply prices that aren't profitable for both sides. I don't believe them obviously, having come across too may examples of clearly capable people running tied lease pubs well and going to the wall, shoved out by bailiffs and or other dodgy activity on the part of their 'Family Brewer' freeholder.

    Basically the whole industry is a colossal fit up and we have been and we, the people and government, are been misled on a comprehensively massive scale by BBPA, Family Brewers and Pubcos because it's in all their interests for the status quo to stay for as long as legislatively possible. Being lateral about this, Tim Martin taking Wetherspoon's into joining BBPA right now, after a long history of being outspoken about the Tiesd Model for all the right reasons, looks to me to be pretty clear evidence that keeping the Beer Tie going as long as possible is best for everyone - except, of course, for lessees and customers all over the UK. If the Tie goes so does, with time, much of JDW's market lead in that sector.