Profitable leased and tenanted models need to be ‘fair and equitable’

Following the pubco’s recent win at the 2023 Publican Awards​ in the Best Tenanted/Leased (up to 500 sites) category, Rippon, who joined Fuller’s ​in 2022, claimed a “great pub company” was all about recognising how “hard” pub operators work.

He said: “I've worked in this role or similar for the past 18 years and there has to be recognition by the pub company of just how hard pub operators work.

“It's a 15-hours-a-day job, seven days a week. In order to have a sustainable and profitable business model in leased and tenanted, it’s got to be fair and equitable and recognise that realistically, as far as a consumer is concerned, it's the landlord of a pub that makes the difference.

“A great pub company is about recognising that and making sure everybody is equipped to do the best they can to develop and grow our people.”

Behavioural change 

However, the industry to see “behavioural change” to tackle current headwinds and satisfy “discerning” customers.

Rippon continued: “We have to understand that as a result of everything our customers are, and will continue to become, more discerning. They have less money to spend and things have become more expensive. So naturally, that's going to happen.

“Our role is very much to make sure our tenants are able to deliver a best-in-class service and quality in their pubs. That is the focus for us but there needs to be behavioural change.”

To support tenants in actioning change and ensuring quality, Fuller’s has organised and funded audits for its pubs, looking at how individual sites can save money with energy costs, for example, as well as a continued discount to rent assessments in line with business rates for the next 12 months.

Cellars and cellar audits are also being updated and “revamped” across the Fuller’s ​estate, including new kit with zoned timers to control temperatures and save tenants money without affecting beer quality.

In addition, the pubco, which operates around 200 leased and tenanted sites, invested £2m into maintaining its estate last year and has pledges to invest £3m this year as well as setting aside £500,000 for energy support.

Rippon added: “We're really trying to drive that beer quality message in our pubs. That's something quite exciting this year.

“We're encouraging our tenants to review costs through looking at who our suppliers are, local price comparisons with other pubs and to really think about wastage and what can be changed with that.

Different pressures 

“If I can save tenants half a million pounds in a year then, over the next five years, we’re going to benefit from that segment. Because they're better off, they can afford to grow and develop their business, and they'll survive. It is a commercially sensible thing for us to do for the long term.”

Rewards, such as holidays and weekends away, are also being offered to tenants that consistently succeed during audits.

The tenanted director added lockdown had enabled Fuller’s to open a new dialogue with tenants in sharing the “ups and downs” by being more flexible and looking at each pub’s needs individually, which contributed to the pubco’s success at the Publican Awards​.

He continued: “We demonstrated we share in that downside as well as the upside, rather than ‘sorry you've signed this and there’s nothing we can do about it’.

“We treat our tenants as individuals. Every pub is different, it's sat in a different community with different pressures; we don't have one rule for everybody.

“Treating tenants and pubs as individuals is really important and stands us apart to some extent.”