Robert Sayles: Who do they think they're kidding?

By Robert Sayles Robert

- Last updated on GMT

Related tags Term Pubcos

If the latest pronouncements are to be believed then pubcos, like all forward thinking companies, are currently re-evaluating their business model in...

If the latest pronouncements are to be believed then pubcos, like all forward thinking companies, are currently re-evaluating their business model in the light of changing market conditions. A sensible strategy you would think; so what have they come up with thus far? Not a lot it seems.

• New codes of practice: The issuing of codes gives greater clarity about the agreements offered by pubcos, but that is all it does. The very fact that it has taken so long to get this very basic degree of transparency in place says a great deal about the type of people who control our industry.

Whilst the BBPA and BII are 'talking up' the importance of these codes the question we need to ask is how they translate into tangible help for publicans struggling to survive on ever diminishing returns?

The fact is they don't; these are merely words on a sheet of paper, a smokescreen designed to deflect attention away from the real problems our industry faces.

• Clarification of the meaning of the word 'partnership': Forgive me for saying this, but what a load of complete and utter boll....ks!!

This is quite frankly meaningless. The simple truth is that pubcos have become accustomed to taking far too much for far too long.

Rather than having the foresight to put an investment programme in place to upgrade the quality of their estate during the 'good years', they chose instead to squeeze extortionate rents out of premises that were, in many cases, shoddy and second rate.

They also waved the magic word "refurbishment" in front of tenants; a strategy designed to ensure that upgrades required to bring premises up to a decent standard were paid for by the tenant, through increased rental premiums.

Once the initial investment was recouped, were rents reduced? Of course not, tenants continued to pay for the refurbishment again and again whilst the pubco happily pocketed the additional profits.

In addition, they engaged in a somewhat reckless pursuit of quick profit by investing heavily in acquisitions, a policy based on the mistaken assumption that profit levels and property prices would continue their inexorable rise upwards.

This breathtaking level of complacency and short sightedness has left some of the major players saddled with levels of debt which allow them little or no scope to deal with the well documented problems we currently face. In short, they have been caught with their trousers well and truly down!

The large number of run down and dilapidated buildings currently being sold off bears testimony to this lack of investment. In years gone by people were content to drink in run down establishments; how times have changed. What was acceptable then is quite clearly nowhere good enough now; rising prices have, not unnaturally, elevated customer expectations.

Those of you wondering what the future holds for our industry might wish to look at the revolution that has transformed the sport of football; it does I would suggest, give an indication of where our industry is headed.

Until the advent of the Premiership, football was almost exclusively the preserve of working class people. They stood loyally on the terraces week in week out; a steaming cup of Bovril and a pie at half time was deemed sufficient to see them through the long cold winter months.

The influx of money, primarily through sponsorship and media, has gradually transformed this sport into the multi million pound business it is today. The top clubs now boast a corporate image, brand new all seater stadia, hospitality boxes and exorbitant entry fees.

It has however, come at a price; the days of the father taking his two sons to watch the local team are, sadly for many, a thing of the past. Yes, venues such as The Emirates Stadium, Old Trafford and Stamford Bridge continue to sell out for each game, nevertheless the profile of those attending such games has radically altered.

Many of what we would term 'traditional fans' have long since departed, put off by the prohibitively expensive entrance fees, yet consoled by the fact that they can watch their beloved football from the comfort of their own living room. They have been replaced by a new breed, seemingly oblivious to the supposed constraints of cost.

Roy Keane once famously lamented that football had lost its affinity with true supporters and become the preserve of the "prawn sandwich brigade"; there are those who would suggest that pubs are moving in the same direction.

As with football, people's perception of 'the pub' has irrevocably changed. For many, the pub was almost a 'second home', a place where one could wile away the hours, enjoy the benefits of raucous banter and camaraderie and escape, for a few precious hours at least, the trials and tribulations of daily life.

It was an affordable and enjoyable experience for those on a modest income, one that could be enjoyed on a regular basis. Alas no more, escalating prices have ensured that those days are well and truly behind us.

The ability of pubs to survive will be determined primarily by their ability to attract customers capable and willing to absorb continued price increases; i.e. 'the prawn sandwich brigade'.

What our industry is currently witnessing is the gradual 'gentrification' of pubs; many of the major players have long since recognised that the future viability of their business model lies at the upper end of the market.

'Downsizing' is the buzz word in the industry; the so called flight from 'quantity to quality' has begun in earnest; it is a trend that is likely to continue for some considerable time.

The escalating rise in the price of a pint makes it inevitable that ours will become a two tier society; those that can afford to drink in a pub and an increasing number that quite simply can't. Outlets based in less affluent locations will become increasingly vulnerable; continued price rises will further exacerbate declining sales resulting in additional closures.

The way to combat this seemingly inevitable scenario is for pubcos to change the way they view both their pubs and us; to move away from the mindset of short term gain and focus on the long term future of our industry. I do not hold out much hope; the last few years have, despite repeated calls for change, witnessed nothing but pubco intransigence.

As far as I am concerned the future is clearly mapped out; clarifying the meaning of the word 'partnership' or producing a code will do nothing to change this. What we need are fundamental changes to the way our industry operates, not subtle changes to wording on scraps of paper.

Given where we are and where we're headed is this really the best they can come up with? I don't know about you, but my tolerance threshold for listening to bulls..t is starting to wear pretty thin!!

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