As we tour a selection of sites within the Craft Union Pub Company estate, a grinning Frazer Grimbleby says: “I’m certainly flying the flag.”
Part of the shift in strategy within the Ei Group estate, Craft Union is Frazer’s baby, and one he’s rightly proud of.
While the smoking ban was hailed as the death knell of the sector, it was another seismic change in the industry that created the opportunity for Grimbleby and his team. Forged in the fires of the impending pubs code legislation, Craft Union was just one of Enterprise’s shifts away from its traditional tenanted and leased heartland, and marked a new departure for the business into the self-employed managed model, and one that seems to be rapidly gathering pace within the company’s estate – Craft Union now has more than 120 sites in operation.
“We needed a real solution for the revival of the wet-led community pub,” says Grimbleby, operations director for the business. “We wanted to put quality pubs back on the high street.”
It’s not a franchise
Essentially, the self-employed managed model – and don’t use the F-word – means Ei Group and Craft Union are offering operators a turnkey solution; the company looks after the over-arching issues of running the business, freeing the operator to focus on creating a great pub. “We take away a lot of the troublesome headaches, and allow them to focus on what they do best, operate and engage with the local community,” says Grimbleby. “It’s not a franchise, we’re much more involved in the day-to-day operations than we would be in a franchise. We work together to deliver the success of the pub.”
The operator’s income is derived from taking a share of the weekly turnover of around 18%, out of which they need to pay for extra staff needed. Essentially, the better the site performs, the more the operator’s earnings can increase, as Grimbleby puts it, “it’s about making sure that everybody has some skin in the game”.
The first Craft Union site opened in April 2015 and the company aims to hit a target of 170 sites this year, which he says it is well on track to achieve.
When it comes to converting sites to managed, campaigners often criticise the practice, accusing the pubcos of simply plucking the crown jewels from its tenanted estate. Grimbleby is quick to correct this view, pointing out that site selection is based on the best option for each operation. “We have a very clear, set criteria for site selection. We want to make sure we’re looking at the right sites. We’re very clear about our proposition and where it sits in the marketplace and the demographics we’re looking for.”
He says internal decisions are taken with a panel within the business tasked with estate optimisation. “We want to make sure we’re making the best of the estate, so they look at what the best option is for each pub.
“It’s not a case of cherry picking. We want to make sure we select the right pubs that ultimately will be putting a thriving, quality managed offer back into the community.”
He said the creation of the Craft Union concept has allowed the company to provide greater choice and opportunity for both existing operators and people looking to come into the trade, and it’s certainly proving a hit. “One of the things I’m most proud of is that 35% of our operators have come from our existing publicans within the estate. Switching to the Craft Union model can be a better option for the pub and the publican as well as the local community.”
He said the key factor behind the success of moving pubs into Craft Union has been the integrity of the approach, being open, honest and transparent. “If you approach it in that way, with honesty and frank conversations, you’ll always get the right outcome,” he says.
The concept has been largely limited to the north-west, but it is now starting to spill out into the wider UK, with Craft Union bars starting to open further south, into south Wales, East Anglia, the south-east, and even as far as Torquay. But Grimbleby is not in a rush: “We’ve been aiming to grow the business carefully, in a controlled way, and sustainably.”
But, it’s not all been plain sailing. He admits: “There were a couple of sites that we selected in the early days that we wouldn’t select now, but we’ve learnt from that and we’ve remained committed to those pubs.”
Overall he said that the estate was performing brilliantly, with only a “handful” of sites that they were working on to improve performance.
And certainly that success is proving attractive. Recruitment is looking strong, with Grimbleby claiming the company is inundated with enquiries from people wanting to take pubs. However, he says they are looking for people with experience. “We want to make sure we’re finding people with the right level of experience, and make sure it’s the right fit for them. But the type of pub and operation means that it’s generally not for inexperienced operators.”
And while the offer currently is firmly, and proudly, wet-led, Grimbleby doesn’t rule out the possibility of bringing a food offer into the mix. “There are locations where food may play an important part in attracting people, so we’re developing a trial on food, but our main operations will still be sports-focused, wet-led, community pubs.”
He said they were aiming to introduce food to a couple of sites in the coming months based around a simple offer that he said would include things like burgers, chicken wings and pizzas, all offering “great quality and great value”.
And great quality and great value are key to the success of the operation, as well as recruiting great operators that are helping to give local communities a thriving, vibrant, wet-led pub. To shamelessly steal from Mark Twain, rumours of the death of the wet-led boozer have been greatly exaggerated, and Grimbleby and his team are leading that drive.