Pubco bosses attack 'tough' operators
Two pub company bosses have blasted operators that fail to lend support to tenants when times get tough.
Both Peter Linacre, managing director of Massive, and Peter Salussolia, chief executive of Glendola Leisure, said that if pub companies continued to be tough on tenants a proper working relationship between the two would never be possible.
Mr Linacre said: "A lot of lessees feel they are being screwed over, that when times get tough there is no relationship.
"When do lessors ever sit down with lessees and say, 'well times are bad, here's a brief break or reduction in the rent level'?
"When a business plan is drawn up, do pub companies ever take into account the fact that in year three a rival operator will open next door?"
Mr Salussolia (pictured) said that the idea of a partnership existing between lessor and lessee was a fallacy. He added: "The lease is not a partnership. Tenants are virtually penalised in their rent reviews and it is the company that benefits from an increase in barrelage in a pub, not the tenant."
The pubco bosses were speaking in Birmingham at the annual conference of the Association of Licensed Multiple Retailers last month, where delegates discussed whether the relationship between lessors and lessees was a partnership or a problem.
Lynn Whitley, licensee of the Sarah Mansfield in Rugby, Warwickshire, told The Publican the most important relationship between pubcos and tenants is through the business development managers (BDMs).
"A major problem is that Punch keeps changing our BDM," she said. "They are either promoted or made redundant and it keeps happening.
"We get used to one and he or she gets to grips with our problems and then they are gone and we have to start all over again. This problem has been going on for three years."
Punch controversially cut the number of its business development managers from 90 to 70 in May.
Responding to these criticisms, Francis Patton, customer services director for Punch, said: "We prize the relationship between licensees and BDMs and aim to improve the level of support for retailers. But on the other hand, good, talented people are always going to be promoted."
Giles Thorley, chief executive of Punch Taverns, told the conference that an improvement in the relationship between lessors and lessees was needed to combat the growing threat of external interference in trade matters.
He said: "We are being snowed under by codes of practice with overt threats from government. With the Smoking Charter we have Tony Blair saying that a total public places ban will not happen but the Department of Health has said it could happen within a year.
"We need to work out more cooperation so we can combat growing problems for the trade, such as the Sky issue. On licensing we squabbled about magistrates versus local authorities and took our eye off the ball, which was the detail of the act."
History of the beer orders
The introduction of the beer orders in 1989 changed the face of pub owner and tenant relations forever. The legislation required brewers to cut down their tied estate and to reduce the level of ties on drinks.
However, by attempting to shake up an industry that ministers feared was being monopolised by the big brewers, entrepreneurs were let into the marketplace.
Tenants were faced with pub companies whose focus was in gaining the maximum profit from the whole property rather than simply selling a brewer's beer.
The government revoked the beer orders last year leading to concern that this will allow pub companies to build a monopoly over the industry and hold even greater power in its relationship with tenants.
Related articles:
Punch to cut number of BDMs (7 May 2003)
