Star to buy big ticket items for new lessees

By Mike Berry

- Last updated on GMT

Related tags Star pubs Cost Investment Star pubs & bars

Star wants to help its lessees grow their food sales
Star wants to help its lessees grow their food sales
Star Pubs & Bars has said it will pay for big ticket items such as ovens, fridges and grills for lessees taking on new pubs.

The company claims its new policy will slash ingoing costs for new publicans by 60-70%.

The company says the initiative, which applies to business start up agreements and three year rolling leases, will be especially beneficial to those lessees wanting to run food focussed pubs, where equipment start-up costs can be very high. It says the move will also make it easier for multiple operators to grow their pub portfolios more quickly as less capital is tied up per site.

For Star lessees this means savings of around 60% will be made for pubs earmarked for capital expenditure, rising to around 70% for those not receiving investment, as ownership for this 60/70% transfers to Star Pubs & Bars. The fixtures and fittings Star lessees buy on entry to the pub will typically be 30-40% of the total value made up of trade staples such as furniture, curtains, tables and chairs.

Cash boost

Lessees will still be responsible for the repair, servicing and maintenance of their own as well as the Star Pubs & Bars owned equipment. An equipment inspection will be undertaken prior to any new lessee taking on a pub to ensure equipment is in a good state at the outset.

Star Pubs & Bars will arrange for all necessary statutory inspections of gas and electrical equipment with the costs re-charged to the lessee in a similar way to the current maintenance and statutory inspection programme.

Chris Jowsey, trading director, said of the initiative: “Our research reveals that the high cost of catering equipment is deterring people from investing to increase their food sales. Our new F&F policy is designed to help bridge the funding gap for applicants by boosting their cash flow and reducing the capital they need to raise to lease a tied pub. The programme also furthers our ambition to help enable all our pubs to serve food by 2020 and that 50% of sales should come from food.

“We spend time listening to applicants’ views and looking at ways we can best address their concerns. Keeping new lessees’ ingoing costs down, together with providing intensive one-on-one support in the first few months focussed around individual business plans and maintaining high standards, are key to launching new ventures successfully and ensuring pubs thrive in the long term.”

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