How do you get to be a Sunday Times Fast Track 100 company? Just don’t worry too much about making a profit. At least that’s how Richard Brown does it.
The former managing director of the Blubeckers restaurant chain launched his own pub company five years ago and has since opened one site a year along the Surrey commuter belt.
Each takes at least £35,000 a week and like-for-like turnover has leapt 10% in the past 12 months. In 2012 his little-known company, RB & AH, was placed 72nd among the UK’s fastest-growing businesses.
Success has come, in part, by driving away customers. They used to queue six-deep at the Three Horseshoes in Laleham, Surrey, on a Friday night, for instance, before Brown put paid to that by ditching the live music offer.
“You have got to be careful to recognise when a site is doing well and not get too carried away,” he explains. “When we’ve been getting too much wet trade, when we’re too popular, we’ve had to think again and edge back.
“Food is the main reason for people being in our pubs, and we can have too many drinkers. The pubs that try to be all things to all people can go wrong.
“Profit is for tomorrow,” he goes on. “When will that be? I don’t know really. It’s a refreshing change from the corporate model where it’s about profit-taking today and growth tomorrow. ‘Not for profit’ would be an extreme way of putting it, but I believe in investing first and then going to the profit stage.”
And he certainly does invest. Four out of his five pubs are leaseholds, yet he’s spent north of £2m doing them up. Staffing levels, too, are way above industry norms.
“We can take £8,000 on a busy night and we’ll have 16 people working. A comparable PLC business would have 12 people. That extra four makes a difference to service levels, and it’s less of a stressful experience for staff. We want people to be busy, but my concern is always whether there are enough staff.”
Coming from someone with such a solid corporate background, you’ve got to take Brown’s eccentric approach seriously.
He joined Blubeckers after catering college, and 22 years and three bosses later he was still there having seen it grow from one site to 23. It started as another part-time job, but original owners Anthony and Tracy Hancock spotted his potential and he became key to their expansion plans. By the time the business was sold to Jersey’s Ann Street Brewery in 2000 he was managing director.
“We were offering burgers and ribs, the kind of food you couldn’t get outside London in the 1980s, and we were fantastically successful.”
Brown stayed on to run the group for Ann Street, later CI Traders (and now Sandpiper CI). When the brand was sold to The Restaurant Group in 2005 he was starting to worry that it was “being overtaken by newer pub-restaurants on the Mitchells & Butlers (M&B) model”.
He adds: “The Restaurant Group wanted to raid M&B for ideas and create a country-dining style on larger sites with a pubbier format. It had big plans and wanted me to stay on.”
Brown did so, and in the next 18 months he opened six more sites. But he admits he was “lacking confidence in the brand. We were saddled with a number of sites that were too small”. Brown says: “It was time I personally stepped out of the business. There was nothing wrong with The Restaurant Group, but I didn’t really enjoy the corporate side. I am an operations person.
“Anthony Hancock and I had always said we’d do something else together, and it made sense to go in with him. I was fairly clear on what I wanted to achieve. There were opportunities to create smart pubs with good controls that also had a homely touch.”
For want of a more imaginative name, Richard Brown and Anthony Hancock called themselves RB & AH. Graham Day joined them as kitchen manager and they negotiated a loan deal with Barclays, just ahead of the banking crisis. Their first pub was the Red Lion in Horsell, Surrey, a Scottish & Newcastle (now Star Pubs & Bars) leasehold.
“It was a tired pub that had run out of steam,” Brown recalls. “We paid a £230,000 premium and spent £400,000 on it.
“We wanted it to look, feel and behave like a pub, but with a bolt-on restaurant operation. We agonised over every picture on the wall. But it’s not over-designed, it’s more homely. A kind of accidental style.”
The Red Lion has now been joined by three other Surrey pubs: the Three Horseshoes in Laleham, a Fuller’s lease that the brewer has just named its Best Town/Local Pub; the Onslow Arms in West Clandon, an ex-Massive Pub Company site on a nil premium, free-of-tie lease; and the Old Plough, Cobham, also Fuller’s.
In addition, there is the Crown in Twickenham, west London, a freehold bought from Enterprise Inns for £1.4m. Each has taken a big spend to get it to the standards that Brown requires, including £800,000 on the Onslow Arms and £750,000 on the Old Plough.
“Yes, it’s more than you’d usually spend on leasehold pubs, but we realised we had to create something different, and leases are fine when you’ve got confidence in your ability to grow turnover.
“Our average take is £35,000 to £40,000 a week, and that confirms that we’re doing the right thing and also encourages us to be ambitious.
“Across the business we’re 55% dry and 45% wet. We have the same menu in the bar and restaurant, and if you want table service for two sandwiches that’s fine. We’ll take it on the chin. That’s been a great strength of ours.
“We’re not interested in upselling,” he goes on. “I’m not a hard-selling kind of person. All I’m interested in is being good to customers so they’ll trust you and come back. That’s what we instil in our people.”
Staff are recruited locally, “to get the longevity, the links to the community”, and selected on their likeability. “Everyone I take on is likeable. We’re a homely business, and that’s something we brought with us from Blubeckers. There are no sophisticated training programmes, it’s all done very much on the job.
It’s about training people in the right attitude, and being prepared to ditch people who don’t have it. That sounds mean, but you’ve got to be prepared to do that when it’s not right.”
As it grows, RB & AH is becoming a more sophisticated operation. Three former Blubeckers people have joined the management team — ops director Duncan McLeish; HR and training manager Alison Jupe; and a second kitchen manager, Nick Masham.
The company might even get a new name. “Those initials can be confusing and something more memorable might help,” Brown admits.
He aims to maintain the pub-a-year expansion, “but there’s no particular pipeline at the moment. We’ve been lucky so far in that the sites have come to us”.
“Any more than eight or nine, though, and the family feel will get stretched. We’re pretty centrally controlled, which involves the management team being available all the time, and that sets a limit on the size.
“We enjoy owning the business ourselves, and I enjoy running it. When the whole place is humming and the team is running well, that’s when I get my satisfaction. I don’t feel the need for an exit.”
After catering college, Richard Brown joins Anthony and Tracy Hancock at the original Blubeckers restaurant in Shepperton, Surrey, rising to managing director
Blubeckers grows to 10 sites and is sold to Ann Street Brewery, later CI Traders, for £14m. Brown stays on as managing director
CI Traders sells chain, now 17 sites, to The Restaurant Group. Brown stays on and adds six more sites
He reunites with Anthony Hancock, plus Graham Day, to form RB & AH
Launches the new venture with the Red Lion in Horsell, Surrey
Opens the Three Horseshoes, Laleham, Surrey
Acquires the Onslow Arms, West Clandon, Surrey
Adds the Old Plough pub, Cobham, Surrey
He takes first freehold, the Crown in Twickenham, west London. Hits 72nd spot in the Sunday Times Fast Track 100 league table