Opening a pub is stressful - but it's the most exciting time

03-Dec-2012 - Last updated on 03-Dec-2012 at 12:40 GMT

Related tags Opening

Scott: "In my experience it is the cost lines on the P&L that get ignored for too long"

A new pub generates customer trial and lots of individual and collective PR. It is your chance to change the perception of your pub, and a chance to make a step change in its performance. But, it is also the most difficult time.

The competing priorities of design, recruitment, training, cash, suppliers, equipment and marketing are a massive list. It never ceases to amaze me how individuals ever get a pub opened at all. Having just opened another pub myself I know from experience how exhausting it is, and I have a few other people to help.

The truth of the matter is though that we need loads of help. The big companies do it through armies of builders, designers, trainers, and with a much larger pre-opening budget than the smaller players. They have the scale and it is a big advantage that they can deploy.

Short-term gain?
I went to a newly opened pub the other week, asked for a drink and the menu. To my disappointment the staff member replied that the kitchen wasn’t going to be open for another month. I wouldn’t open a pub like that, I thought. Maybe I was wrong, but I can’t help thinking we have to make the most of the new opportunity for customers to visit.

I went to another newly opened pub last week, and had a beer in the bar. There was no music and the place felt a little too much like a funeral parlour, so, spotting a speaker, I bravely asked if they wouldn’t mind putting the music on. “The music won’t be fitted for another two weeks” was the reply. To my mind music and food are as important as light and beer. If you aren’t ready, don’t open! I understand that you might have to for financial reasons. Of course the real danger is that what you gain in the short term you lose in the long term.

When you are ready and really prepared for opening, the next question is how much marketing you should do. I think here the jury is divided, with some promoting the “go slowly and build”, and others promoting the “market it hard and see what sticks”.

I am actually in the middle of these two. Every business opens operating at less than 100% of their ambition on service, speed and quality. The team are new, the equipment is new (or old maybe more importantly) the tills are new, the layout is new, so we all go a little slower. It takes time to build up our speed and service levels. I therefore argue that you market the business to try to break-even quickly (no point running out of cash) but then increase your marketing based on your confidence in the business.

This is harder and more responsive but ultimately better, and your guest feedback will be greater. Of course the big advantage is that e-mail, Facebook, etc. all help in being responsive to trade and not having to plan too much in advance. I did a reasonable amount of awareness marketing ahead of opening, but have held back on any marketing afterwards because we are busy enough for the team and our skills at this point.

Managing costs
Finally we come onto the subject of profit. I unwittingly caused a bit of a stir last year by explaining that the pub we had just opened had got to profit in six weeks. Our latest pub has got there in four. But the truth of opening a pub is that as quickly as you are focusing on driving sales you have to be managing costs. The biggest is labour. I argue that you have to get you labour costs to the right ratio in four weeks, otherwise the team think they can work more slowly than you want them to.

It also means you probably need to plan your rotas for the first four weeks before you open, but then adjust based on sales each week. The other big costs are food and drink, and getting the second stock take done is critical. The first gets rid of the opening mess, the second tells you if you are on track.

In my experience it is the cost lines on the P&L that get ignored for too long, and this then can cause cash problems if you aren’t making enough money. As always it all comes to a head as the first VAT bill looms.

Opening a pub is probably one of the most exciting (and, yes, stressful) things we ever do. And when it is your money, your livelihood, and your pride it makes it all even more stressful. I can still remember my panic when the chair manufacturer said he was going to be two weeks late (we hired some – a bit curry house, but at least we had them). One of our amps on the music system blew and the old dishwasher gave up the ghost.

While they are a minor disasters at the time, we all get through them somehow, and can then enjoy and love our pubs.

Alastair Scott runs Catton Hospitality and S4Labour.