Drink Talking: Tom Fender

Pubs need to face up to reality - and adapt or die, says Tom Fender, managing director of retail research company him!

Jack Welch said "if the change OUTSIDE your business is greater than the change INSIDE your business, then you're GOING OUT OF BUSINESS".

Sometimes change is forced upon us, just like the smoking ban in all public places voted for by MPs.

Pub companies have a number of options open to them - but in reality, they have just one - adapt, or die. Ultimately, the people who will decide if any business succeeds in this competitive market place are customers (yes, yes, we've heard all this before)... but consider how businesses in other fields have had to change to new situations:

• Petrol forecourts - little more than a decade ago, petrol stations were "fags and fanbelts" stores selling little more than an L plate and the odd chocolate bar.
  Then the supermarket chains came and forced margins to plummet across the board.

Now look at forecourts - 90 per cent of them have a convenience range and many have developed food-on-the-move offers like Esso's On the Run and BP's Wild Bean café.

The Post Office lost 1/3 of its business overnight when the government started paying benefits straight into recipients' bank accounts.

While some post offices are having to close, the network itself is trying to reinvent itself as being a "supplier" or a concession within other retailers' stores. It is developing its customer offer by introducing insurance and bureau de change. McDonalds is now the biggest retailer of sliced fresh fruit in the UK.

Go into any McDonalds now and you will see a vast array of healthy products like salads, supported by nutritional information helpful for parents with kids. Sales have grown since the introduction of healthy options. The local specialist retailers who survive and prosper (like butchers) now offer pre marinated foods, kebabs and ready to cook meal solutions, recognising that busy lifestyles or the "can't cook, won't cook" generation need all the support they can get to continue to eat well.

These are just some examples of how businesses have adapted. Pub companies must do the same.

We bemoan the power of Tesco - but really we should recognise the fact that they are where they are because they have listened to their customers and delivered against them each step of the way. How well do you know, listen to and satisfy your customers....time for a belated new year's resolution?