News Article Comments : MPs told pubco model is 'outdated'

RE: MPs told pubco model is 'outdated'

Just listened to the first submissions - interesting....

Of what they said, we have an RPI annual rent increase, and we were unable to get calculations provided to us when we had our rent review in April this year, where we got a £500 discount of our £4,500 increase. We were shown a single line of about 6 figures that 'represented the area' - no basis in fact relating to our pub and our circumstances. The BDM said that was that – end of negotiations – and the truth is arbitration is expensive and most of us are unwilling to put ourselves physically, mentally and financially through such a process when the terms of the lease dictate the findings that are allowable in arbitration – meaning that if upward only clauses etc exist, then unless specifically waived by the PubCo officially, the arbitrator can’t rule against that!

In terms of what we were provided with on entry:

1. No historical data whatsoever.

2. Pub was on managed agent number 5 in the previous 12 months.

3. A price list that showed discounted prices which we based our profit and loss around, but subsequently turned out to be 'for a different lease' and not ours - because we are full tie no discount!

Our deposit receives 2.5% interest - why has nobody brought that up?

Anyway, now the PubCo lawyers will have plenty of time to listen to what has been said and wriggle out of it all - shame they didn't go first (again).

PLEASE BEC, don't simply believe the words - just because people SAY they do things doesn’t mean they ACTUALLY do them!

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MPs told pubco model is 'outdated'

Good point Tony: just because people SAY they do things doesn’t mean they ACTUALLY do them!

I personally believe the issue here is NOT the actual model, but how it is executed (is this a misleading word to use here?)

Some Regional Managers (or BRMs / BDMs etc) do a great job, and some are a waste of space.

Some Companies try hard to really do the right thing for the long term, and some just pay lip service to this and scrabble over the money like a manic scrooge.

I am clear which ones are which in my opinion, but I won't name names here, as there is no open reply.

Perhaps the best outcome would be more transparency and tighter regulation, combined with legally enforceable service charters from the landord, based on the promises made when the lease was signed. It's iniquitous to agree a rent for a property when you're promised a whole lot of support, but, when the lease is signed, the support goes for a ball of chalk. This happens a lot.

If the support is substandard, then the rent should be discounted.

However, I still believe the model is basically a good one. It just needs to be executed properly, and with integrity and accountability (on both sides). All too often this doesn't happen, and the result always is the ubiquitous disasters we see every day.

Don't throw the baby out with the bathwater, but please do warm the bathwater up a bit, and ensure it stays at a healthy temnperature!

GUY.

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RE: MPs told pubco model is 'outdated'

Tony, your point number 3 seems to be a case of Fraud. Have you followed up on this?

This post replies to Tony Preston > RE: MPs told pubco model is 'outdated'

RE: MPs told pubco model is 'outdated'

We keep hearing the statements from the Pub Cos that signing a lease is voluntary on the part of the incoming lesee, that you don't have to sign. That all the information required to make a business decision is available to the prospective tenant / lesee. To a point it is. But we, as many other 'newcomers' to the trade, were faced with the take it or leave it scenario - the lease I signed wasn't as onerous as some I examined, the rent wasn't crippling, and we had a chance of success - at a price much cheaper than a freehold. Freehold / leasehold we could have failed either way. However, there was minimal choice of alternative leases, FOT types were not entertained by the big Pub Cos, so it was Hobsons choice. Incidentally, my solicitor advised me not to sign, and a trade financial advisor told me to buy a freehouse instead. What wasn't apparent through my lack of experience, was all the hidden costs, the sneaky lease clauses, and the heavily stacked advantage the multi million pound Company with which I am dealing with now, has against an individual such as myself. We are on our own in fighting any injustice. 5 years on, and a relatively successful past few years have helped line the coffers of the Pub Co., and we've made a reasonable living - if below minimum wage counts as reasonable. However, business has become very difficult.

This post replies to Tony Preston > RE: MPs told pubco model is 'outdated'

RE: MPs told pubco model is 'outdated'

Cont.

The help and support promised on entry is there of sorts - my BDM has gone through my accounts but can't come up with any help. Discounted tied beer would be a lifeblood, but was out of the question. Any little 'fiddle' that has help many a licensee sustain an income through the years has been whittled away, because every institution watches every penny during difficult times. So we, the lessee / tenant is getting screwed from all angles - and what happens, nothing. Sorry, an enquiry in which the Pub Cos will state the cost of help to tenents £1.3 million a month, will fail to help again. I wonder if the £1.3 million will be quantified? Most forms of help are the signing of full tie agreements in return for discounts on these products. Discounts that are usually poorer than normal wholesale prices. So in real terms the Pub Co hasn't lost out - they actually gain accounts, and despite discounts, their income hasn't dropped. Three years ago, (previous Pub Co) another smoke screen the Pub cos will be hiding behind - 'we have only recently taken charge of these properties', I 'negotiated free of tie agreement. They offered quadrupling my rent as a take it or leave it. No quantification, no transparency. So here we are - doomed, drowning whilst the band plays on.

edited by: Phil Liddell at: 19/11/2008 10:57:14

This post replies to Phil Liddell > RE: MPs told pubco model is 'outdated'