Monday, February 04, 2013

PUB CLOSURES 18 a week: *It's Official* Or is it?

PUB CLOSURES 18 a week: *It's Official* or is it?

These stats come from CGA Strategy, or someone like that. Where do they get their figures from. Where DO the figures for pub closures come from? Who is out there with a clip board counting all those pubs closing all over the country, all the time?

No one. That's who.

The figures, like pretty much everything else reported about the pub sector, come largely out of thin air (I do hope someone can prove me wrong on this).

Intuition, common sense and anecdotal information from my inbox filling up with pubs for sale via commercial agents tells me 18 is a rather modest underestimate. Today 16 pubs in my email. I don't recall seeing any of them before. I have a feeling that agents have stopped saying 'New to Market' because it's too easy to notice the trickle is actually a hemorrhage.

My hunch and judgement can't be trusted, I know, as I'm infected with a virulent strain of 'Just Can't Believe the Bullshit I'm Being Sprayed With' but still. 16 in one day against 18 in a week? And I've been noticing these sort of anomalies and posting these kind of observations about the official closure figures for how long? Few years. It's not right.

Where do the figures come from?

They come from the pubco's, collated by someone else like BBPA, trawled by analysts / market followers and released as 'official' in reports by CAMRA etc. If not. Where else does the raw data come from? I'm in no way suggesting that CAMRA are part of the problem - they have to get their figures from somewhere. Live everyone. The only people in control of the figures, really, are the pubco's making disposals. Incidentally. Mentioning CAMRA is not to include them in the scam. We all are victim we have to get our figures from somewhere. And the only people who know are the pubco's making the disposals.


  1. Mark - I came acros your blog while researching the pub market as I consider taking on a pub for the first time.
    I;m no expert, but I have done a lot of reading (lots of time on my hands following redundancy last year), and I believe the pub closure figure is a net amount. So it may be that there are 50 pubs closing each week, but 32 reopening = 18 net closres.
    That might explain why the number seems to understate the reality of actual closre numbers you are aware of.
    Does anyone have the actual closure v opening numbers?
    It's a scary business to enter at this time, but hopefully with teh right pub, the right pub company and the right advice there are still good opportunities out there.

  2. Hello Brian

    They are supposed to be net figures as you note. But there are no real experts in this area - the figures are compiled by clerks in nameless offices using data from unknown sources - none of which want the world to know what really is happening with the pub sector for their own vested reasons.

    The closure totals are published erratically according to the need of the moment by the people who, at that moment, want to publish pub closure figures to suit the purpose of that moment.

    CAMRA rely on figures published by BBPA who are entirely funded by pubco's and family brewers - companies in whose interest transparency does not serve.

    CGA Strategy are cited as the source of many of these stats - no one knows where they get their raw data except CGA. I would imagine they get it through imperfect means - as there is no accurate source as far as anyone I know can see.

    WHATEVER - none of the closures take into account CHURN where in one pub premises one lessee's business fails and the pub is subsequently re let to a new tenant. These figures are not published AT ALL, anywhere.

    I think it's possible to state from unscientific observation without fear of contradiction that the churn rate is at least THREE times greater than the closure rate - which only relates to pubs which are considered to have closed for ever.

    My recommendation to you regarding taking on a pub is:

    Do it only if you get the freehold or a free of tie lease.

    Do not under any circumstances take on a tied lease with any company, no matter how benign it may be being sold to you. You will regret it.

  3. By the way Brian - do get in touch if you'd like to talk through anything you come across regarding pubs.

    There is no right pub company and the only right advice is 'don't deal with pub companies' and there are still good opportunities out there but they are not with pub companies...

  4. Thanks Mark. I will accept sound advice from any source at this stage of proceedings! I here what yo're saying about not taking on a tied lease - but I have been looking at an tied tenancy opportunity with my local (family) brewer. They have a pretty good reputation among their tenants, from what I've been able to gather. I like the idea of having lower fixed (rent) costs in exchange for higher beer prices. If I push for a free-of-tie option (which I'm not sure they'd entertain in any case) they'd surely just ramp up my rent to compensate and my fixed costs would be higher?
    Obviously I need to understand the implications of these choices before I jump in.
    Your warnings are noted!