The Association of Licensed Multiple Retailers (ALMR) has called on landlords to cut its members some slack when it comes to rent reviews.
Addressing the trade body's annual conference yesterday, ALMR chief executive Nick Bish told delegates the costs of running a pub were being considerably underestimated by the larger pub operators, and rising fast. Consequently the big companies needed to be mindful of the pressures their lessees face, he said.
Presenting the results of its latest Benchmarking Survey, which polled 39 managed pub companies throughout the UK, Bish revealed that salaries and other staff costs amounted to 27 per cent of turnover of the average pub, with entertainment at nearly seven per cent, other premises costs at 5.7 per cent and charges for utilities, including waster disposal, at 4.3 per cent.
However these costs were assessed before rent was taken into account and there was clear evidence that landlords "underestimated the costs of running a pub", he said.
"Looking at these numbers we suggest that ALMR members have this data in their back pockets when it comes to going through the process of a rent review," he added.
The multiple operator sector also had to deliver a message to government about the burden of red tape, Bish said. "Security and door costs are a growing element in the sector, whether you're a community or town local, or you run a food-led operation or a pub with accommodation," he said. "Giving the government these findings will prove that our industry is doing its bit to improve things."
The survey found that there was an industry average annual like-for-like sales improvement of 3.71 per cent, a sign that "smaller operators are running to stand still, especially in the face of government legislation", added Bish.