Breathing space: subcontracting your pub rooms for profit

By Emma Eversham

- Last updated on GMT

Nice little earner: don't leave your assets gathering dust, subcontract out your rooms
Nice little earner: don't leave your assets gathering dust, subcontract out your rooms

Related tags: Rooms, subcontracting, business case

For licensees looking to make extra cash to keep the business rates wolves from the door, subcontracting your space to groups can be a low-maintenance way of bringing in extra revenue while creating goodwill.

Function rooms can be a nice little earner for pubs. But advertising the space, taking bookings and running events can be time-consuming. For licensees with a busy schedule, subcontracting out your space to regular groups can be a stress-free way to make use of the space without lots of extra work. 

On the surface, a mother and baby group in Kent, a school PTA in West Sussex and an advice club for small business owners in Surrey have nothing in common. However, these groups are united by one thing: a reliance on their local pub to provide the space in which they meet.

For pubs, particularly those in villages or in residential areas of towns, a function room usually reserved for private celebrations such as weddings or birthday parties, is simply wasted space and money when not being used. 

And while it can be tempting to only ever seek remuneration for a space you have invested in and must maintain, only hiring it out for a high fee may not always be for the best, as Graham Rolland, general manager at Redcomb Pubs’ Worplesden Place in Worplesden, near Guildford, points out.

“A lot of people hold out for the huge corporate market and won’t rent out their function rooms for less than a few hundred pounds, but if it’s sitting empty it’s not making you anything,” he says.

 

A much-used space

Rolland regularly hires the Worplesden Suite – a state-of-the-art meetings room complete with AV equipment, microphone and iPod docks – to corporate clients for full-day meetings, with the space also providing a venue for many a wedding reception, christening or wake.

It is already a much-used space. Yet Rolland sets aside time in the diary for local groups, such as the Lonely Owners – an advice-led club for owners of local small businesses – to use the Worplesden Suite on a regular basis.

“I think it’s great for the business,” he enthuses. “The Worplesden is an extremely busy venue, but using our space for groups has transformed things since I took over. The Lonely Owners group, for example, have a set two-course menu and coffee for £20, but I don’t charge room hire. You have to take each event on merit.” 

The value in allowing groups and clubs to use their local pub’s function room for free, or a nominal fee when not booked out, should not be under-estimated. As those who are doing it prove, it can bolster profits much more than a one-off high-spending event ever could.

When Andy Fox and his wife took over the management of the Holly Tree in Walberton, West Sussex, earlier this year, they made a decision to allow local groups, such as the local school’s PTA, the village cricket club and the Mother’s Union – a church-based social group that supports families – to use their function room, the Silver Room, free of charge, although groups based outside the village are asked to pay a small donation to one of the pub’s designated charities.

“We’d moved into a small village and we wanted to get along with the local community and that was the primary reason,” he explains.

The gesture is a smart business move, with the food-led pub enjoying an uplift in visits for lunch and dinner, simply because they’ve managed to showcase their offering and welcoming surroundings to a new audience.

“[Having groups using the pub’s facilities] has a knock-on effect on business levels, because we get people visiting who wouldn’t have done so before. They tend to browse the menu and see what we offer, then come back for lunch or dinner with their friends or families,” says Fox, whose cunning move of setting out complimentary nibbles for delegates has an immediate impact on trade.

“I find that if they’ve had the nibbles they are more likely to stay at the bar for a couple of drinks, or teas and coffees, when they’ve finished their meeting,” he says. “I also put copies of our menus and newsletters advertising our events in the meeting rooms to let them know what we’ve got coming up.”

At fellow Redcomb Pub’s the Bickley in Chislehurst in Kent, general manager Garry Wood opens the doors to his upstairs function room – the Club House – at 9.30am every Wednesday and Friday for local parent and baby group Hartbeeps. On each day there are six classes, with up to 18 mums and their children attending each session.

It would be perfectly feasible for Wood to charge the organisers a fee, especially as he opens up an hour and a half earlier than usual for them. However, he felt it was more important that new mothers had a place to meet others like themselves within the community.

“Young mums give up work and start maternity leave and can be isolated. They have been used to being in work, so they don’t want to be at home for a long time. Here, they can interact with their children and other adults and come down and have lunch in the pub afterwards,” he explains.

 

Justifying a no-fee stance

On a Hartbeeps day, you may find up to 50 women and their children having drinks or lunch at the Bickley, which Wood believes more than justifies the goodwill no-fee stance. In addition, Wood estimates that showcasing the Club House and the pub in the way he does leads to incremental sales of between £35,000 and £40,000 a year.

“Because the mums are familiar with the pub, they hold birthday parties for their children here, as well as christening parties and naming ceremonies,” he says.

Ben Bass, general manager at Bel & The Dragon in Reading, sees the same knock-on effect at his pub. The venue’s dedicated events space – the Majestic Bel barge moored on the Kennet and Avon canal – is opened up to an NCT new parents group every Tuesday afternoon and a business networking group for women on the same day.

“We have seen a knock-on increase in business from hosting these groups and using the extra space,” he says.

“When guests are thinking of nights out or special occasions I’m sure they do think of us first. For example, through our NCT group we have hosted baby showers, engagement parties and even a wedding.”

 

Carry out a risk assessment

If you are inviting regular groups to use your facilities for free, the advice is not to treat the space any differently than you would for paying guests.

Jonathan Smith, partner at licensing solicitors Poppleston Allen, recommends carrying out a risk assessment before any group uses the space for the first time, to ensure it is right for their purposes. It also shows an element of care and attention that reflects well on the business.

Wood believes the décor and regular upkeep of a pub’s function space is as important as that of the main bar and dining areas.

“You should treat them exactly the same. Our room is cleaned every day and we pride ourselves on it looking good. It’s a spectacular space with fireplaces either end, nice furniture and special glassware,” he says.

“All those things make it special and stand out. It’s not got a sterile look like you’d find in a church hall or a bland hotel meeting room and that’s why people like it.

“Those publicans who close off their function room and forget about it, leaving it in a mess, are silly. Even if you’re not using it for community groups, you could have a potential customer come in and want to look at it.”

While maintaining a function room has obvious benefits for the business, some may question whether there are the resources to do so as well as manage the requirements of a variety of groups, especially when staffing in hospitality has its challenges.

Rolland of Worplesden Place opens his pub half an hour earlier than the usual 7am when the Woking Business Breakfast Group has a meeting. He believes the group, whose members are charged £7.95 each for breakfast, are worth the earlier start for him and his chef.

“There’s no room hire or hidden costs because, the way I look at it, this is a community business worker using the space, not a big firm. Independent local businesses are our bread and butter, so for local businesses you go a little bit outside the norm.”

Bass at Bel & The Dragon leaves the groups to manage use of the space themselves, only using staff if tables need to be set for dining and to serve food and drink.

The Holly Tree’s Fox sees no impact on his staff, even when he ensures a designated member of staff is available to exclusively serve customers in the Silver Room.

“We don’t have to put any extra resource in for groups. We just carry on as usual. We find that when the room is used for a paying event, having a designated person works well as they build up more of a relationship with that person. It’s more personal.

“Put it this way, if you had a table of eight in the restaurant you’d have a member of waiting staff looking after that table, so it’s no more effort than we’d put into running the main restaurant.”

 

Is it legal?

There are no specific legal requirements regarding the hiring out of space within a pub. However, publicans should check the conditions of their premises licence before allowing groups to use their space, particularly if the group includes under-18s, says Jonathan Smith, partner at Poppleston Allen.

“Some licences do have conditions, such as no children under the age of 16 allowed on the premises after 9pm. Remember also that if your pub is wet-led, legally, anyone under the age of 16 must be accompanied by an adult,” he says.

Remember that if the space is being used outside of licensing hours, the organiser of the event or meeting must not serve alcohol as this would breach the terms of the licence. In the unlikely event the meeting organiser requests that they employ their own staff to serve alcohol, the designated premises supervisor would need to meet them and ensure they are responsible individuals.

Smith also recommends carrying out a risk assessment before allowing a group to hold an event in their function space, especially if it involves children (although this is not a legal requirement). “They may want to suggest that the organiser of the event uses plastic glasses if the event is outside, for example,” he says.     

 

Related topics: Events & Occasions

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