Trade union launches attack on pubco profit margins

From The Publican

Start a new threadBy James Wilmore , 28-May-2009

Related topics: General News, Company & City News

Trade union the GMB has stepped up its attack on the pubcos - claiming that Enterprise Inns has a profit margin nine times that of supermarket giant Tesco.

 

A study by the union suggests that Enterprise has a profit margin before tax and interest of 57.3p in the pound, compared to Tesco's 5.9p. It also claimed that Punch's profit margin is 35.9p per pound of turnover.

 

The study was discussed at a meeting yesterday with campaign group Fair Pint, where a strategy to break the tie was also thrashed out.

 

Paul Kenny GMB general secretary said: "The pubcos are yet another example of financial engineering by the City gone wrong.

 

"It is high time that the Labour Government put an end to the pubco model for the benefit of consumers and tenants alike."

 

However a spokesman from Enterprise Inns dismissed the figures as an unfair comparison.

 

"Enterprise Inns and Tesco are two totally different businesses," he said.

 

"Trying to draw parallels between them is at best ridiculous and at worst deliberately disingenuous.

 

"Attempting to make this comparison shows the GMB hasn't got a clue about how the pub industry operates."

 

City analyst Mark Brumby agreed it was an unfair comparison. "The GMB is comparing apples with oranges here as the cost of rent sold is always going to be low in comparison to goods such as groceries and indeed beer," he said in a briefing note.

Find us on Facebook

Spotlight

The cost of Premier League copyright violation

The cost of Premier League copyright violation

There is a saying that lightning never strikes twice in the same place, but if you are...

David Beckham to launch a whisky

David Beckham to launch a whisky

David Beckham is to launch a whisky in partnership with Diageo.

Explosion in e-cigarette use presents dilemma for pub operators
Feature

Explosion in e-cigarette use presents dilemma for pub operators

It’s the biggest thing to happen to smoking since the ban. Electronic cigarettes (or e-cigarettes) are on...

Speak up if you're suffering

Speak up if you're suffering

Depressed and overworked licensees should seek help, argues Pete Brown.

Follow us on