Marston's tenants say 'no thanks' to volume-led variable rent deals

Marston's pub tenants have been reluctant to take up the brewer's sales-based variable rent agreements because they require too much transparency, the group acknowledged last week.

Speaking as the Midlands brewer announced a 13 per cent fall in full year profits, Alistair Darby, head of Marston's tenanted and leased pub operation, said the take-up had been much lower than the group had anticipated.

Only a dozen pubs have moved to the arrangement, which was introduced earlier this year, Darby said.

"It needs a degree of transparency and some of our top-end retailers have been reluctant to go down this route," he added.

While this rent deal had yet to see significant take-up, Darby said Marston's had recently introduced a new tenant support initiative called 'Rescue Package' which it hoped would offer a significant level of support for tenants who wanted to work with the brewer when they found themselves in difficulty.

The plan sees the brewer match a selected tenant's investment in areas such as additional training resources, including profit improvement courses and a range of action plans to improve their business.

"Under the scheme the tenant gets visited by an independent business consultant a number of times a year who looks at profit opportunities for that pub, such as energy saving advice and so on," he said.

This was an "active management approach to debt-laden tenants", Darby said.

Some 30 pubs were trialling the scheme, which was a "gesture of intent from both sides", Darby added.