Could these new venues be killing pubs?

By Nigel Huddleston

- Last updated on GMT

Hybrid & niche venues remind us pubs need to stand out
Hybrid & niche venues remind us pubs need to stand out

Related tags: Coffee

From cafes serving beer through to niche outlets where standard pubs don't answer the need, The Publican's Morning Advertiser looks at differing business models - the threats as well as the lessons.

You used to know where you stood when going out to eat or drink. A pub was a pub, a café was a café and a restaurant was a restaurant. Now, it seems that all of these things are themselves and all of the other things too, as increasing numbers of leisure outlets morph into hybrid venues that attempt to combine the best bits of each in a bid to be all things to everyone.

This year has seen Pret a Manger outgrow its long-standing reputation as a go-too lunchtime stop-off for a decent sandwich and a drink with the trial of a Good Evenings concept at a branch in The Strand in London’s West End.

The shop is transformed after 5pm into a “casual dining experience” with meet-and-greeters at the door, proper crockery and a menu that includes salads, small starter-style plates, macaroni cheese and bowls of Korean pulled pork. It may not have central London’s Michelin star restaurants hitting the panic button just yet, but if replicated across the chain’s hundreds of shops it could put a dent in the bottom line of significant numbers of city and town centre restaurants and pubs.

What does this mean for pubs?

Crucially for pubs, the Good Evenings​ concept includes alcohol, with bottles of Portobello Pilsner and Barry Island IPA providing some craft beer credibility, bottles of Prosecco selling for £25.95, and choices of two red and two white still wines, all at £16 each.

Customers are still expected to order and pay at the till in advance as they would during the day but plated meals are bought to their tables, similar to upmarket fast food chains such as Gourmet Burger Co – and pubs.

Its combination of competitively-priced food – mains are mostly in the region of £6-7 – and drink arguably threatens to tread on the toes of casual dining pubs more than any other type of outlet.

Pret claims that the move was driven by customer requests for an early evening menu, with a particular eye, given the West End location, on the pre-theatre crowd.

Are coffee shops turning into pubs?

Starbucks has the potential to do more damage still with 830 stores across the UK. This year saw it introduce a Starbucks Evenings programme at coffee shops in Stansted, Edinburgh and Bristol airports, Euston station in London, and in Covent Garden in the capital, not far from the Pret evening concept.

Like Pret, the menu includes hot and cold meals with beer and wine for consumption on the premises, but no spirits. The package is available from 4pm each day and the Covent Garden offering features beers from London’s Mondo and Five Points, Estrella in Spain and wines from Italy, Spain, Argentina, New Zealand and Washington, the home state of Starbucks in the US.

The main difference between it and Pret is no queuing with orders captured on hand-held devices by staff around the café.

Steve Flanagan, director of marketing and category for the UK and food for EMEA at Starbucks, says: “We believe there is a fantastic opportunity to continue to grow transactions and business in Starbucks stores between 4pm and 9pm.  We are delighted that customer and partner feedback has been positive so far.”

Staff are being trained to help them cope with the different demands of an alcohol outlet.

“Partners are trained to spot and assess customers who may have had too much to drink, and will refuse service to anyone who is visibly intoxicated,” says Flanagan. “We also have a security protocol in existence for any threatening situation that might occur in any of our stores.”

Fast food outlets are also encroaching

Even high street burger chain Burger King is trying to get in on the hybrid act after applying for licences to sell alcohol daily from 10am to 11pm at restaurants in Newcastle-under-Lyme, Blackpool, Hull and Bury St Edmunds. Initially it plans to sell only American beer in plastic bottles for consumption on the premises but there’s no good reason to think that it wouldn’t extend its ambitions into other alcohol categories should sales take a grip.

Burger Kings in the US, Singapore, Venezuela and Spain already sell alcohol and the chain has 654 branches in the UK that could potentially do the same if the idea were to be rolled out.

Rival McDonald’s, however, has publicly ruled itself out of selling alcohol in its UK restaurants.

The off-trade is morphing into the on-trade

The hybrid trend has not only blurred the boundaries between different types of leisure dining outlet but also between on - and off-premise.

Dozens of specialist wine shops now incorporate on-trade characteristics, serving wine by-the-glass, bottles of craft beers and, in some cases, bar-quality cocktails. Many serve cold plates of cheese and charcuterie to minimise staff costs and hygiene red tape but some, such as Surrey-based The Vineking, have converted bigger shops into pop-up restaurants on selected weekend evenings.

Cheshire-based wine merchant Corks Out opened its fifth store this year, in Kuntsford, at the heart of a town centre circuit that has 43 bars and restaurants. All of Corks Out’s stores now have an element of on-premise alcohol consumption, some with front-of-shop pavement seating and some with large gardens. Drinks menus include cocktails, bottled beer, coffee, by-the-glass wine and three-brand flights of either Champagne, gin, whisky or sherry.

Customers are also free to choose any bottle of wine from the shop’s retail shelves to drink on-site for an additional £10.The move has taken owner Ruth Yates into new territory on planning, food regulations and staffing, with new starters now more likely to have hospitality than wine retail experience.

“There’s just not enough money in straight wine retailing to keep a business going with overheads, staffing and cashflow issues,” says Yates.

Cheap drinks in supermarkets have been a major spur to businesses like Corks Out. “The only way to increase margins is to put sampling machines in or a bar, offer wine by-the-glass or to start serving coffee,” she adds.

But while much of the high street is trying to widen its offering to maximise revenue, other businesses are thriving by sticking to their guns on niche concepts.

Niche concepts gain interest from people bored or the norm

London’s Cereal Killer Cafe's unconventional approach – 120 breakfast cereals with a choice of milks and toppings – proved too much to take for anti-gentrification protestors who attacked its Shoreditch premises with paint and smoke bombs in September.

Just up the road, Lady Dinah’s Cat Emporium offers tea and cakes in 90-minute pre-booked sessions, with a £6 cover charge. In this case, it’s not to cover service or corkage but the cost of upkeep for the 12 cats that are the venue’s main attraction.

Sew Over It’s sewing cafés in Clapham and Islington offers access to patterns, sewing machines and other equipment, and unlimited tea for £6 an hour.

Ziferblat is billed as a “treehouse for adults” – snacks and coffee are free and users can have as much as they like for a flat fee of 6p per minute while they’re on the premises. The treehouse has, er, branches in Liverpool’s Albert Dock, Manchester’s Northern Quarter and Shoreditch, naturally.

And no, we’re not making any of this up.

Such venues are succeeding by targeting a clear demographic and supplying a specialist offering but in the mainstream, hybridisation smells more of the future.

Flanagan at Starbucks says he expects more venues to hybridise over the coming years.

“We believe there are similarities between wine and coffee and the people who are passionate about them both,” he says. “If you’re in Spain, you wouldn’t blink at people serving alcohol alongside coffee. “So I think we will see a growth in this area over the next couple of years. However, in the true spirit of a traditional coffee house, while some stores may serve wine and beer, our coffee will remain the focus of the experience.”

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