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Monday, October 27, 2014

The True Cost of Pub Closures are the Human Costs that are Never Calculated. It HAS to stop.

Dear CAMRA friends. Please bear with me. This is serious. I'm a professional publican. I have to tell you a story of the everyday in tied pubs. This is an insight into what really lies behind pub closures all over the country. Whenever there's a boarded up pub, there's a story rather like this one behind the scenes, a story that hardly ever gets reported. It's the pub closures that journalists, communities and pubco's concentrate on, not the human tragedy that's the real story.

What's on my mind is that my friend, Val Spencer, on Twitter @Lifelandlady, is in hospital with a brain hemorrhage from the stress of fighting Enterprise Inns, her 'business partner' for years.

Val is 46, doesn't drink or smoke, eats carefully, exercises regularly and has a history of good health. has three daughters aged from nine to eighteen. She and her husband Gav, the chef in their Enterprise Inns owned pub, the Old Cock Inn, Sheringham (excuse me, it's actually Lavenham), recently separated and Gav moved out of the pub with their daughters. They have been in dispute with Enterprise for years now, as many tied publicans are with their freeholders, year in, year out. I had a similar was of attrition with my freeholder, Heineken for years too. It's should destroying, depressing and utterly negative.

This is completely wrong. As a society we accept these wrongs happen all the time. It's business. Every time a pub closes or shuts temporarily We allow this kind of thing to happen just because the pubco's make profits. They make profits by taking all the profit out of their pubs. That means they take all their tenants' profits, leaving the tenants with nothing. Their tenants' businesses, pubs, are failing in ever growing numbers while the pubco's use the profits taken from their tenant to pay £hundreds of millions in interest on the loans they bought the pubs with in the first place.

This is a private equity asset stripping scam. It's decimating British traditional pub culture, devastating communities as they lose their pubs forever and it's all dependent on running pubs into the ground and selling as many as possible for alternative use. This is getting rid of around 2000 pubs every year. It's changing society irrevocably.

Money makes the pubco's behaviour right. We let them get away with it. It's wrong and this is the REAL ‪#‎GreatBritishPubcoScam‬ - the human cost, the damage to thousands of individual publicans, their families, the communities they serve, the statutory authorities, the tax payers, who pick up the tab for these few private equity driven sociopathic 'pub company' corporations who are destroying some of our most treasured and precious, unique and irreplaceable way of life.

It HAS TO STOP. I know what fighting a pubco is like... I was a tied tenant for sixteen years. I took on a shithole boozer that was dead on its arse in the middle of some of the most socially and economically deprived Wards in the UK and turned it into a pioneering, leading gastro pub that other people, and pub companies, have copied. My business turned over £750K a year and I employed up to 20 staff in all that time so don't think I don't know what I'm talking about. All I got was almost two decades of fighting a pubco that was purely intent on taking ALL my profit and screwing me into the ground financially.

The problem with people on the outside is they always say.

"You can't say stress has done that to them."

That's what the pubco's say. It's what everyone says. They're wrong.

Her medical team don't have any problems identifying the problem..

I don't have a problem knowing that it's stress because I became suicidal when I was battling my pubco. Six years of rent review, being told you're a failure all the time by your business partner who have teams of staff turning the screws on hundreds of individual publicans constantly. That's what they do. And people on the outside tell people like me, who's been through it all and knows dozens of people it's been done to, and is still being done to, that we're wrong...

I know it's happening all the time because it is.

You simply choose to tell me I'm wrong.

British tied Pubco's are a national disgrace. The evidence of their utter failure is written all over our landscape.

Just step back and look at what is happening all over and put the events together and you can see the Great British Pubco Scam, the result of an unfettered market where corporations do whatever they want - including completely abusing contract and the human rights of thousands of individual people who invest in the pubco's 'low cost entry' into running 'their own' business.

There is a litany of news reports from regional papers all over the country of publicans being abused by their pubco's, that stretches back decades.

These are regarded as one isolated case after another of an individual publican being mistreated by rogue Business Development Managers who somehow did a load of things the Board of Directors regard as totally out of order.

There is a similar continuous trail of stories of communities all over the UK campaigning to try to save their last pub (almost always ex tied pubco) from conversion to alternative use. These communities always discover their pub is about to be shut forever just as it's happening and it's a done deal. There's almost always a developer in the frame with cash who expects to turn the pub into profit.

These are regarded as the isolated odd story of one pub or another that: 'sadly is no longer economically viable' (according to the freeholder) even though there is a whole community up in arms about it, saying they NEED a pub, WANT a pub, and will put money into saving their pub, IF they get the chance to save it. And carpers on say 'if you didn't want to lose it you should have used it' - while completely missing the point that the pub was not used because it was deliberately run down to make it 'unviable' and suitable for sale.

There are stories of publicans committing suicide, of publicans and their families leaving their pubs overnight, of sudden mysterious closure of pubs, all over the country. There are stories of pubs being turned into Tesco Locals, Sainsbury's, Coop shops, Paddy Power, Coral, other betting shop chains and into ugly residential conversions that blight townscapes, all over the country. There are stories of Punch leasing pubs direct to Tesco Of Marston's selling 200 pubs, with tied tenants in situ, to Private Equity retail specialists.

Meanwhile there are individual stories popping up all over the country of communities and small pub companies taking on failed ex tied pubs, clearly proven by events and described by their pubco's (as above) as being 'no longer economically viable' and investing in them and their successfully becoming really attractive, busy, financially viable local pubs and community hubs again.

Meanwhile there are individual stories of 'Micro Pubs' popping up all over the country in non licensed shops and talk of a revolution in the pub sector. These new businesses are manifestly serving a demand for something good, authentic new and of the moment that the rest of the pub sector, manifestly, is not serving.

Meanwhile, across the last decade from 2004 to 2014 the government has called four Select Committee inquiries to investigate the relationships between pubco's and their tied tenants. Each of these inquiries has concluded that there is widespread evidence of serious abuses by pubco's and that unless they change their behaviour they must be regulated. Each inquiry has said 'the pubco's are in the last chance saloon'.

The response from the pubco's family brewers and the British Beer and Pub Association has always been 'isolated instances of abuse, self regulation is working, thousands of tenants are happy with their relationship with their pubco, regulating the tie will close all family brewers and the pub industry will collapse'. And nothing changes - the next inquiry finds the same as the last.

When you take all these things and look at them together what is happening is obvious but these stories are not linked up, never connected except in the most cursory way as being evidence of Britain's changing habits. Yet in almost every instance there is a tied pubco in the background

What these events describe very clearly is the systemic carve up of the British pub sector by tied pub companies and bigger brewers who copy them. They are just cashing in on tied tenants all over the country, milking them as hard as they can for cash and when their businesses fail ultimately they sell them and use the proceeds to either pay debt interest or to invest in new build managed chain pubs that are the same as all the other pub company pubs. It is everywhere, it's endemic, it is deliberate and it's coming to a pub near you and the result is a run down pub, often a beautiful building, that chronically lacks investment, is smelly, falling apart and is simply not fit for purpose and cannot compete with say a Starbucks or any other business that doesn't have buddleais sprouting from the roof and toilets that stink and can actually legally sell products YOU want THAT is why no one is using the pubs...

And YOU, and most other people, are very likely to say something like:

'If you didn't want to lose it you should of used it'

16 comments:

  1. http://www.thecockatlavenham.co.uk/index.html

    If you can't get the basic details such as pub name and location right, what are we to make of the rest?

    (Lavenham's about 80 miles from Sheringham).

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    1. Thanks for pointing that out - amended.

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  2. you have obviously not read the rest ! and as your pointless and petty remark shows you would not care .Thank god Mark wont be shut up .

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  3. Mark's diatribes are almost always the same, word for word. I have read the rest and there's nothing really new.(The incorrect pub name and location are actually in the third para not the last page).

    I do have sympathy for anyone who's ill.

    A couple of things to consider.

    Mark's final "unaffordable" rent was settled at arbitration; that's the mechanism for an independent RICS third party to set the rent when the parties disagree.

    My understanding is that this lady purchased the lease from another tenant. I wonder what Mark's take is in the ethics of knowingly selling a "car with faulty brakes" - as he says all tied leases are (and indeed discussing someone's health and family matters on an open, public forum)

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  4. your missing the point ! until someone recognizes that Mark is telling the truth and speaking for thousands of us he will never get tired of repeating his self and you certainly wont wear him down .

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  5. Mark posts a lot of generalised accusations and allegations, few of which can be checked.

    Here are two with numbers though:

    Is this true for all 20k tenants? - "That means they take all their tenants' profits, leaving the tenants with nothing." The surveys which Mark dismisses so readily would tell a different story.

    Let's assume every pub closure is tied (they're not). 31pw = 1600 - contrast with "This is getting rid of around 2000 pubs every year"

    If the things which can be checked are exaggeration - what are we to think of the rest?

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  6. Interesting take from a former Punch tenant:

    http://stonch.blogspot.co.uk/

    more evidence against double pricing, and another who sold a lease - presumably not a non profit one!

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  7. This comment has been removed by the author.

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  8. This comment has been removed by the author.

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  9. The date of the blog post doesn't undermine its content, which appears to contradict, from the horse's mouth so to speak, two of Mark's key propositions - double pricing and zero profits.

    On sympathy, other than repeat that I have sympathy for anyone who's ill, I'm not sure what more to say.

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    1. Doh! There you go again.

      The #GreatBritishPubcoScam is called a SCAM because that is what it is. These are the way various dictionaries handle SCAM:

      SCAM

      A fraudulent business scheme; a swindle.
      To defraud; swindle.
      A stratagem for gain; a swindle
      To swindle (someone) by means of a trick
      A dishonest way to make money by deceiving people
      a confidence game or other fraudulent scheme, especially for making a quick profit; swindle.

      I'll be back when I have a moment to deal with the rest of your stuff.

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  10. There are only three points really:

    You've exaggerated the pub closure numbers - unless you can point me to another source which verifies your figures.

    The tenant in the blog didn't pay 2x pricing. So it's not general.

    The same survey that puts 60%in the <£10k bracket also puts 1% at >£45k; by definition there are 39% in between. So tenants aren't "left with nothing".

    You're wrong in some checkable things. What are we to make of the uncheckable allegations and assertions?

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    1. My point was made on 18 November 2014 in the House of Commons by a democratic vote to adopt an amendment to the Small Business Bill which effectively allows tied tenants to be no worse off than free of tie.

      Your point has been made by being an anonymous denier of grotesque abuse of an archaic legal construct that should have been outlawed 25 years ago with the Beer Orders when some private equity influence prevented adequate legislation from coming into place then.

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  11. Have you considered that the vote may have gone the way it did precisely because of the sort of misinformation that you've been scattering about?

    What's happened has happened however, and there will be interesting times ahead - including, I suppose, FOT rent assessments based on wholesale prices 50% of list prices!

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  12. It looks as if yesterday's perfectly rational comment was not "approved" for publication.

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