Profit Builder: racing into hot drinks

Only four miles from the Silverstone Grand Prix circuit and opposite Towcester Racecourse, the Folly Inn in Northamptonshire is on the fast track to success with a new line in profits.

Like many others in 2008 the pub, run by licensee Brian Taylor and manager Sam Gurney, is on the hunt for significant new income streams.

It was the challenging times that brought Brian to the Nestlé Professional stand at the Publican Live trade show at London¹s Olympia in April, looking for new ideas to help him take his business forward and add more to the bottom line.

Brian, who has been at the Charles Wells lease since last October ­ and in the pub trade for 20 years ­ realises that publicans are having to think in different ways.

"It's hard at the moment, yes," he says. "But you¹ve got to add every revenue stream you can get ­ and you¹ve got to think outside the box."

That could be through booking folk legends the Yetties for a concert, as Brian has done recently, or it could be through embracing new product categories such as top-class coffee.

With the changes Brian has made to the Folly Inn, including uprating the food offer, coffee was an obvious next step.

Since improving the food ­ where before much of it was microwaved, now 75 per cent is homemade ­ the wet/dry split at the pub has been running at 30/70.

Adding to the quality​

A greater emphasis on cask ale has added to the quality feel of the business too ­ the pub has recently applied for Cask Marque accreditation.

The recently installed Milano Series 3 hot drinks machine is the next stage in adding quality.

Although the pub has offered hot drinks since day one ­ including basic filter coffee, cappuccino in sachets and tea ­ Brian believes the new machine, and working with a trusted brand, will take it to another level.

"We were investigating what we could do with coffee when we spoke to Nestlé Professional at Publican Live," says Brian.

"It's a real opportunity and there¹s definitely a market for it. There are a lot of older people in this area, and we feel that if we can become known for our coffee it could be a real winner for us."

Coffee and other hot drinks, as Nestlé Professional beverage development manager Bryan Claringbold attests, will appeal to everyone if they are sold in the right way.

As well as adding to the destination nature of the business, the offer, marketed outside the pub with swing signs, is also aimed at attracting passing trade from the busy A5 outside, and race-goers in the area.

A strong message​

The Milano Series 3 machine is now visible at the end of the bar, sending out as strong a message to customers as the ale pumps alongside it.

The model, one of a range available from Nestlé Professional, was recommended to the Folly Inn on the basis of the pub¹s footfall, staff expertise, space and logistics available.

All that was required for installation was a 15ml mains water supply and a mains outlet. The company also fitted a carbon filter to ensure taste and odour are up to scratch.

Nestlé Professional says the equipment can actually save on electricity as it is thermostatically controlled ­ once it comes up to temperature there is no need for the power surge that is regularly required for a kettle.

Simple to operate at the touch of a button, the machine does not even require fresh milk. The offer at the Folly Inn will include eight different drinks: black coffee, white coffee, cappuccino, latte, espresso, mocha, hot chocolate and tea.

The price points are being pitched at between £1.95 for an espresso and £2.50 for a cappuccino, latte or mocha. Decaf is available for £2.25. With the cost working out at as little as 25p a cappuccino, the profit potential speaks for itself.

"It¹s down to the individual site how much they charge for it," says Bryan. "Obviously the key to this is that it's at a price which is generating incremental sales for them." Licensee Brian and Sam are now expecting to sell between 20 and 30 coffees a day.

In addition to the swing signs outside, the Folly Inn has point-of-sale material and table cards inside to remind customers of the new lines ­ and drive awareness.

Nestlé Professional is providing stock including After Eights and Aeros for some free promotions to entice customers to sample drinks from the new machine.

"There¹s a great opportunity here for both locals and passing traffic. Once you've had a good coffee you go back again and again," concludes Bryan.

"From Nestlé's perspective this is a great opportunity for a site which is almost virginal in terms of coffee ­ we really believe we can achieve some good numbers for Brian and Sam."

Follow the progress of hot drinks sales at the Folly Inn in The Publican ­ look out for more Profit Builder articles later this summer.​

Hot Drinks​

The opportunity: ​The Folly Inn at Towcester in Northamptonshire is looking to switch from filter coffee and kettle-made tea to a more professional solution ­ offering a bigger profit opportunity

What's happening:​ Nestlé Professional is installing a Milano Series 3 machine (pictured right) which produces a wide range of quality hot drinks 

Cost of the equipment:​ The machines can be bought outright for £2,500 ­ a range of leasing packages are also available

The profit potential:​ At a cost of 25p a cup, prices at the Folly Inn range from £1.95 for an espresso to £2.50 for a cappuccino, a latte or a mocha