Tenancies & Leases Guide: Pubco Profile - Enterprise Inns

To run a successful pub business lessees may have to display a creative side.

Lessees and tenants remain a driving force behind innovation in the pub industry. Where managed pubcos have trotted out tired formulas and freetraders got stuck in a rut, the relatively cheap entry offered by the pub lease has meant that it's the people with the ideas, rather than the cash, who have been able to turn a business around.

It's an effect that has certainly been noticed at Enterprise Inns which, when the merger with Unique Pub Company is completed later this summer, will have 9,000 independent businesses across its estate.

Recent successes include the Thornberries (pictured)​, previously the Roebuck, in Middleton, Manchester, where a joint venture with the lessee has seen a coffee bar installed to attract local shoppers.

For recruitment and development manager Peter Grieve the potential lies in harnessing that creativity and spreading it across the estate.

"One of the reasons why we try to get licensees along to training courses is because it's good to get them together and encourage them to share best practice," he said.

"On one recent course a licensee said they sold disposable cameras to stag and hen parties at the pub, and that's an idea others could take up."

Customer services director Simon Townsend agrees. "The best trainers are our licensees - and they like to talk about what they are doing," he said.

You could level the criticism at Enterprise that it is becoming too big. But Simon believes that its increasing ability to attract a variety of entrepreneurial operators is one of the factors that means that, overall, it is becoming more successful.

"There is no question that we are seeing fewer business failures and reduced bad debts, and you have to ask yourself whether that's because we're bigger," he said.

"We are attracting high quality licensees and we learn a lot from them, especially when it comes to introducing food, for instance."

Growing numbers are applying through the company's website, from 10 per cent three years ago to 50 per cent today, which itself has introduced a more "business astute" individual into the Enterprise estate. "They have brought fresh skills to the business," said Peter.

More of Enterprise's pubs are being run by a new breed of multiple operators who will typically take on between 10 and 15 houses. Often these pubs have been transferred from management - and under a multiple will remain, in effect, a managed house. "It's another indication," said Simon, "of the growing quality of our estate. Leaseholds are a great way for an entrepreneurial pub business to expand."

Despite the bad publicity surrounding pub leases, Enterprise, in common with other companies, has noticed no decline in interest from people wanting a pub. "If anything we're probably getting too many people coming to us," said Peter.

In fact, Enterprise has raised the bar to entry, increasing minimum ingoings to around £50,000 in the South and to £15,000 in less fashionable parts of the country.

Once you get your pub, though, you can expect increasing levels of support from the landlord.

New licensees, for instance, are offered a free "welcome package" of three items including membership of the British Institute of Innkeeping plus a choice of two from a subscription to e-commerce website Barbox, merchandising, Cask Marque registration, a Johnson Diversey hygiene pack or a place at a skills workshop.

Have a look at which pubco is offering which deal - click here​ for our full listings.