How Electric Star is future-proofing its business

The Electric Star business started in 2008 with the opening of its first site the Star at Bethnal Green, east London.

Founder Rob Star said: “I had never worked in a pub, never pulled a pint before, didn’t really know what I was doing but I had always put parties and events on and I had a big database of people.

“I knew lots of DJs, lots of bands so I knew I could get the place busy. If I could do that, I could learn how to do the other bits.”

Star highlighted how important it is to offer guests something else other than food and drink to pull the punters in.

He added: “We have always got to have something for our customers to do. There’s not really a pub we operate where we could just open the doors and expect people to come in and fill all our venues.

“Even in King’s Cross – at the Star of Kings – even though there's lots of people coming in after work, we operate on three floors in that venue. We have got a basement where we have comedy nights, live music nights, DJ nights.

“Then we have a first-floor function room where we have a private karaoke room where we do birthdays and so on.

“We are finding we really have to put events on for people to do as well as them just coming in to have a drink and a bite to eat.

“We have to have a really good lunch offer and we partner with street food traders in all of our pubs too.”

Squeezed margins

When it comes to the challenges facing operators in the current climate, Star emphasised increasing prices were an issue as well as a change in consumer habits.

He said: “Definitely costs are being squeezed from what seems like all angles. Wages are going up, business rates are going up, costs of your products going up and while those margins are being squeezed, you either have to put your own prices up or you have to attract more people to come to your venues.

“We are definitely seeing people are going out a little less and saving for special occasions. It's a known fact people seem to be drinking less so you're battling increases in costs with potential decreases in sales, which may over the next few years, squeeze a few operators out because the climate is quite difficult at the moment.”

Currently, Electric Star’s pubs are all inside of London and there aren’t any plans to open outside of the capital.

Star added: “For me, it's really important to be able to get around all the pubs really easily. I used to say I wouldn't take a pub unless I could get there on my pushbike in less than 15 minutes and now we have expanded a little further than that and I have got a car now so now I say if I can't get there in about 15 or 20 minutes in the car, then it's too far.

“But for us, as a small company, if you have six sites in London then open one in Cambridge or Oxford or somewhere on the edge of London then you've got to service that pub.

“We also like to be in the sites, I'm in all the sites all week and if you've got one that takes a long time to get there, you can't share the resources between the pubs. We have a bookings and marketing manager and we want those people to really know the pubs and I don't feel we could probably do that if we stepped outside London, or we could certainly find it more difficult to do that anyway.”

But, if the opportunity occurred for Star to open a site in his hometown, he would consider doing so.

Future plans

He added: “I'm from Leicester so I would go back to Leicester because I love it. There’s a great mix of people there, it’s a really friendly city, the football team’s not bad... it’s good.”

Looking to the future, Star outlined how the next few years look for the business and why he has a particular number of sites in mind.

He said: “We are in the legal stage on another site that is going to open next year and we are getting offered a lot of opportunities at the moment so we will probably do two more sites over the next 12 months.

“We are aiming for 10 to 12 over the next three years. When it gets to that size, we have a really good strong head office team.

“At that size, you can get around all of those sites and you can still know what the manager’s name is and all the names of the staff. It can still be a relatively small business.

“I would rather develop those sites and make those sites better and still grow but certainly not grow at a really fast pace.”