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Pubs are in Crisis Pubs are in crisis – closing at a rate of around 30 a week – as drinkers desert them in record numbers in the face of the smoking ban, increased prices and the credit crunch. It has also become increasingly difficult for pubs to compete with supermarket “lost leader” pricing and an increasing number of ways for people to spend their leisure time. Since the infamous “Beer Regulations”, the industry has become dominated by the “so-called” PubCos who on one side can negotiate heavy discounts with the brewers and on the other take ever-increasing rents from licensees – effectively decoupling shareholder dividends from the production of beer. While there have been some benefits of the change – not least, the wider choice of cask ale available in pubs – there have been considerable downsides. While choice has increased, these pubs are still tied to supply via their PubCo who, while negotiating big discounts with the brewers, fail to pass these on to the licensee (and the customer) who, if allowed, could purchase beer much cheaper on the wholesale market. PubCos will argue that they add value through branding and other support. Recent years have seen increasing pressure and while some pubs are clearly thriving, it is becoming increasingly difficult to build a successful pub business in the current climate. To maintain shareholder value, PubCos have increased rents and beer prices, squeezing the licensee - resulting in many leaving the industry. PubCos seem content with this, expecting new, novice, licensees to enter the industry and continue a pub’s success. However, this supply is now drying up but it seems that PubCos would still prefer to shut a pub rather than support the landlord via rent reductions and flexibility in beer supply. Ultimately, the idea was that the pub had a property value and, if required, could be sold but the credit crunch has changed this. Hence the PubCos are in trouble. Their reaction is predictable –negotiate better deals with the brewers on a restricted set of brands to improve margins and increase rents. The result is to make life harder for licensees as restricted choice drives yet more customers away. It seems that PubCos can’t see that success relies on delivering what the customer wants. These days quality, choice, local, green are all buzz words. Brands, while not on the way out, are more price sensitive and are in the control of the bulk discounters such as supermarkets. Pubs have one unique selling point – they are the only place you can drink draught cask beer. Quality local ales are not only what the customer wants but can maintain a premium price even in these straightened times. Just look at those pubs that are thriving – it doesn’t take a rocket scientist to see that quality local produce is a key driver. Interestingly, PubCos had spotted this trend and many have signed up to the Society of Independent Brewer’s distribution scheme. However, many licensees have not taken advantage of the opportunity as availability to publicans is often determined by local “business development managers” who are often incentivised by the big brewers. Several examples of the problems facing licensees – and hence drinkers - can be seen in Warrington. A few years ago, the Bulls Head, next to the Tavern in Church Street, was thriving as a wet-led town pub. The licensee creatively utilised the guest beer list to feed off the Tavern’s trade and build foot-fall in the area. However, rent rises and beer supply problems saw the loss of the licensee and since then the pub has struggled with several licensee changes and restricted beer choice. The Plough at Houghton Green is a successful suburban food venue with considerable cask beer sales driven by a keen landlord. Following customer demand, a Weetwood beer was established as a regular LocAle and during summer, the landlord succeeded in getting 3 Weetwood beers as regulars alongside his changing guests. Unfortunately, this coincided with a reorganisation at the PubCo and subsequent change in policy and this victory appears short-lived. Back in town, The Bluebell, another pub which has struggled to re-establish itself when a long-standing landlord moved on, has recently blossomed – simply by putting on a range of 5-6 interesting guest beers. However, since this was against the short-sighted PubCo policies, the licensee has left and the pub is now shut ... doh! PubCos need to wake up and smell the hops. The landscape has changed for good and traditional business models are dead - shareholders need to understand that the business needs to be creative – playing on the strengths of the pub and allowing licensees the freedom to give the customer what they want thus allowing them to build up a strong and robust long-term. This will in turn benefit the shareholders. The unthinkable alternative is a continued decline in the number of pubs resulting in less choice and even less profits. Let’s hope they come to their senses. Mark Enderby
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Saracen's Head Revived! After a series of temporary managers, Dave Bodily, has now taken up the tenancy at the Saracen’s Head in Warrington – the old Greenall’s brewery tap which is now owned by Lees. His first task was to clean the substantial cellar and order more cask beer. Within a week, John Willie’s and the seasonal beer had appeared alongside the bitter and his hard work was rewarded by customers emptying the casks over the first weekend! With word getting around, the pub is attracting new custom and, within 6 weeks, cask beer sales have risen by 250%! The Saracen’s Head is still a traditional multi-roomed pub and is ideally suited to cask beer with 2 large cellars allowing keg and cask beers to be kept at different temperatures. As cask beer sales develop, Dave is using 9 gallon and 18 gallon casks to ensure quality and availability throughout the week and, hopefully, this will enable the smoothflow beers to be removed. His latest venture has been the introduction of Lee’s Brewer’s Dark mild and this is now a regular! Architecturally, the pub has much of interest with wood panelling and fine stained glass (depicting the Saracen himself). There are 4 rooms clustered around the servery area with a large dining area to the rear. Outside there is a coach yard and bowling green. Upstairs is a magnificent meeting room (used by local societies) which was once the Greenall’s director’s dining room. This is sumptuously appointed and has a vaulted wooden ceiling. Pictures of Greenall’s directors past look down from the walls! The pub forms a haven from the bustle of Stockton Heath pubs and is handy if you’re shopping at Morrisons. Good value food is available throughout the week (except Mondays). The Saracens shows what a good licensee in partnership with a regional brewer can achieve in a short time (contrast this with the PubCos!). The Saracens is well worth a visit. For more details see www.thesaracenshead.net. Finally, one mystery... In the cellar is a pipe which runs under the road from the former brewery site. What was this used for an “under the counter” direct beer supply?
Good Beer Guide 2010! As we approach the New Year it becomes necessary to select the clubs and pubs to go into the 2010 edition of the Good Beer Guide. As a Branch we base these on tastings by members throughout the year. It is clear for information already received that there are a few places which show great potential but lack sufficient visits from enough people. They are the Hare & Hounds, Crowton, Dog & Partridge, Paddington, Barn Owl, Agden Wharf and Grappenhall Community Centre. Even some clubs and pubs already in the Guide are short of the number of visits required. Anytime you visit a club or pub in the Branch please send your marks to Nick Bosley (Branch Chairman). For details of the scoring system, please see right.
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