Monthly Archives: February 2010

Pub Credit Card Machines

Credit card machines are an essential in any pub which has a reasonable food base or in a town centre where customers find it easier to pay by credit or debit card.

It guarantees your money but takes some days to get to your account, it is extremely convenient and costs you money, customers like it, you can also do cash back with certain companies.

It’s convenience normally outweighs the costs if you are taking more than £40K per annum.

You can have an installation cost, which I consider a rip off and have refused to pay on a number of occasions.

You have the monthly rental, which can vary from around £15-£20 on to-days prices, shop around for the best deal and haggle, you might get an old fashioned look, but ignore it, a deal is a deal.

The bit where you save money is the percentage charged on credit cards, the charges for other than credit cards varies, is normally proportionate to the percentage rate.

Your kindly Bank Manager will invariably set you up with anything between 1.8-2.8%, which seems like nothing until you work out the numbers.

The BII have a deal with HSBC for members at 1.15-1.33%, you don’t have to bank with them but it always pays to have a second account with some money in, in case your main bank gives you trouble, you try opening an account when you’re on your limit.

Banks don’t talk to each other??? I made that mistake once, never again.

You might say that percentage difference is not worth bothering about.

A very sobering thought for every .5%  above the BII member rate per £100K you are giving £500 net profit to the bank, that equates to around £2k at least in takings.

I had two pubs last year putting £500K per year through their PDQ machine at 2.8%, because that was the rate their friendly Bank Manager gave them in their last business, that equates £9K net profit going to the bank.

When they realised the enormity of their profit waste, they both said they were locked into the present machine for a year, I pointed out at that loss of net profit they could well afford to pay the rental on the first machine and still show a vast profit.

It is Net Profit that is being spent not Gross Profit.

This is not a commercial for the BII but straight business sense, if you would like details email me at the buyingapub.com and I will ensure that you are contacted or http://bii.bii.org/membership/Individual-membership/how-to-join.

Sadly Banks take enough money, make sure yours stays in your account.

For BII members  http://bii.bii.org/membersonly/business-benefits#pelican

Barfly

Lamb Tagine from the Jack in the Green

Lamb Tagine (Serves 4)Ingredients1kg boned and cubed lamb shoulder
1 tablespoon ground/grated or finely chopped root ginger
Freshly ground black pepper
Teaspoon of ground cinnamon or one cinnamon stick
2 teaspoons turmeric
1 tablespoon paprika
½ teaspoon cayenne pepper
2 garlic cloves peeled and crushed with a little salt
2 onions peeled and finely chopped
4oz dried apricots
2oz whole almonds
2oz large golden sultanas or raisins
4oz mixed pitted large green and black olives
1oz pine nuts
Good quality olive oil
Tablespoon honey
Teaspoon of good quality saffron
400ml chicken/lamb stock
400ml passata (sieved tomato puree)
Fresh coriander (approx 25g finely chopped)

Method:

1). Coat the lamb in half the spices and leave to marinate for twenty minutes to an hour.

2). Heat some olive oil in your heavy based pan or casserole and brown the meat in batches. Turn it to colour all over transfer to a bowl once browned.

3). Add a little more oil to the pan and add the onion garlic and remaining spices (ginger and cinnamon stick if using). Fry for five minutes to soften without colour.

4). Return the lamb and any juices to the pan and stir well. Add the saffron and honey and pour in enough stock and passata to cover. Bring to the boil. Place in a low oven for an 1hr ½ to 2hrs.

5). Stir in the apricots, almonds, sultanas or raisins and simmer uncovered for a further 30-45 minutes stirring frequently. Cook until the lamb is tender. Taste and adjust the seasoning and sweetness accordingly.

6). Serve simply with some lemon and herb cous cous. Preserved lemons are very popular in Morocco and if you can get them they are a lovely edition to a tagine.

Tips:

Many supermarkets will sell a popular blend of Moroccan herbs and spices called `ras el hanout` which means `head of the shop` and refers to the mixture of the best spices the seller has to offer. This could be used to marinate the lamb and will save same time.

 
Rockbeare, Near Exeter, Devon EX5 2EE. Telephone:    01404 822240  01404 822240 . www.jackinthegreen.uk.com

Griffin Law makes law by serving via Twitter

Griffin Law makes law by serving via Twitter

Twitter LogoToday the High Court showed that while it may be steeped in tradition, it is certainly not behind the times by granting an order which allowed service of an injunction via Twitter.

The Order which is called a Blaney’s Blarney Order after the subject matter – a blog called Blaney’s Blarney (donalblaney.com) – requires an unknown Twitter user anonymously posting under the same name, and thus breaching the copyright and intellectual property of the blog’s owner, to stop posting and immediately identify themselves.

The Blaney’s Blarney Order is the first order ever to be served via Twitter and signals an end to anonymous breaches of the law on Twitter or any other internet site.

Griffin Law, the solicitors who dealt with the matter, are experts in the law of the internet and have successfully prevented internet impersonation before on Facebook and Blogger.

Matthew Richardson, the barrister who devised and won the Blaney’s Blarney Order, said: “The Blaney’s Blarney Order is a huge step forward in preventing anonymous abuse of the internet. People have to learn that they can no longer hide behind the cloak of anonymity the internet provides and break the law with impunity.”

Donal Blaney, the victim of the anonymous impersonation and the principal of Griffin Law, said: “This is an important step in dealing with online bullying. The scales of justice have been tilted in favour of innocent victims today.”

This story has featured in the following:

Landlords Revenge

Landlords Revenge.
We had exchanged contracts on a pub and one of the very near locals was making a nuisance of himself, in always insisting on a pint seconds before we called time and then taking up to an hour to finish it. The girls asked me to have a word because it was making us all late in clearing up, which I did and he refused to cooperate.
Having exchanged contracts I thought it was time to get the landlords revenge. I went down to the chemists and bought a bottle of senacot syrup (great for constipation). I then said to one of my staff when Fred comes in put a couple of drops in his beer and we will see how long it takes to work, then we can time it and with any luck we can get him running out at closing time.
I finally went down to the bar after time had been called and Fred was ranting that the barman had shouted time too early and he hadn’t got his last pint, I checked to see if anyone had put any senacot syrup in his beer, they hadn’t so I got a half pint glass put about a eighth of a glass of senacot syrup and filled it up with beer and gave it to him. He said he wanted a pint and I said the half was on me, he took a drink and said it’s a shandy, I said he was acting like a child he had a childs drink so drink up and go home, which he did.
He didn’t speak to me for three days and when I finally spoke to him, he said the beer had upset his stomach all night long, but he was not so keen to get a pint last thing at night after that. (SRE)

A Black Hole in Tenant/Lessee Support

It would appear that there is yet another hole in the system, in terms of any form of protection for tenants and lessees.

We have the BII Codes of Practice, designed to stop abuses by companies within defined guidelines.

We have PIRRS (Pub Independent Rent Review Scheme) designed to stop unjustifiable rent increases.

We have absolutely nothing for tenants/lessees who have been misinformed or mislead into signing a lease with conditions that their lack of experience failed to identify.

I have had three with the same company, where the BDM allegedly told them that the company had a survey done at every change and agreed rental levels far in excess of the pubs capability, their money is running out or has run out, viability with the rent levels is a pipe dream for all three.

They have all spent money on refurbishing on what were depressed pubs with minimal business, two of the pubs are in a far better state than when they took over, the third is collapsing with serious dilapidations before they took the lease.

All the previous lessees left in a hurry and the dilapidations were overlooked by the Pub Co.

My initial inquiries raised the instant statement Caveat Emptor, which is legally correct.

However in my discussions with Nick Light at the Chepstow BII Rent Road Show, I raised the misinformation issue and at that stage various companies and commercial agents were hiding behind Caveat Emptor as a get out, he said this was unacceptable.

He did have some influence on making three more lessees lives better.

My point is that in theory new lessees fall within various guidelines under the BBPA Agreement, hopefully.

All the ones that do not, have no redress or course of action on pubs that have trading conditions, where rents are totally beyond viability or dilapidations are being enforced because the BDM allegedly said that the company carried out a survey.

The rents were not based on historical trading, but on wild speculation i.e. T/O £107K rent £26.4K, T/O less than £100K rent £28K and the latest has a similar T/O with a rent of £35K.

All the people believed the BDM that the rents were viable, to a Competent Operator, which the rents are based on, a Competent Operator would think it a joke, but to desperate people or people following an enforced career change they think these figures are viable.

There is no body or system that these people can turn to for a fair decision.

The Pub Co attitude at BDM level is get out if you don’t like it, you signed the lease.

I was impressed with Nick Light’s presentation and his comment to me that Caveat Emptor was unacceptable when people signed a lease with impossible conditions.

No person within the company is available to discuss sensibly the problems to arrive at an equitable solution, when viability is impossible because of the trading conditions imposed within the lease and with no justification of the figures.

Since there is no system to assist these people, Nick Light in his new position as Managing Director, might like to back his words to me and set an example to the Industry to address these problems, he has my email address, I would be delighted to assist him in resolving these problems equitably and turn the pubs into viable pubs based on trading ability.

Terminal Illness and a Pub Lease

It has definitely not been my best week in the Pub Industry.

I was asked to call and see a distressed lady licensee who was terminally ill with cancer, to see whether I might be able to assist her or provide advice as to what she could do.

She was barely able to walk or talk, she could in fact move a few steps with a wheeled zimmer frame.

I realised that even a brief conversation was not only very tiring but extremely stressful, I suggested that I returned the next day, so that she was able to prepare for a limited discussion.

Also I needed some time to make some phone calls to the right people to be sure that I had some possible options for her, if I could.

I returned the next day with a number of forms which I hoped her daughter would assist me with, to cause the least distress to the lady, which her daughter did.

The lady who shall remain anonymous, looked better than the previous day, but had to struggle to talk or move.

It would appear that the Pub Co were refusing to release her from her lease because her ex husband who had walked out two and a half years ago, at about the same time that she was diagnosed with cancer, was still joint signatory of the lease, she is the licensee and has been running the pub well, until the ravages of cancer became terminal.

It would appear that the ex-husband refuses to sign or agree to anything, yet has no part in anything to do with the pub.

Her two daughters and friends were helping and managing to keep the business going, all she wants is for the Pub Co to release her from the lease and let her finish her days in peace and dignity, without being penalised for giving up the lease.

The Pub Co to be fair have made a few concessions some time ago, the local management would appear to be unmoving in allowing her to leave with some dignity and without being penalised into penury.

The BII and Licensed Trade Charity have been advised and hopefully a suitable conclusion may be reached through their auspices.

It would take very little for one of the hierarchy of the Pub Co to release this lady from her obligations at very little cost to them.

Should they take an opposing view it could represent a massive PR disaster for the company.

I would prefer to write that a satisfactory conclusion has been reached and would give them recognition accordingly.  

I also think that all leases let to individuals should have some sensible get out clauses for the lessee in the event of diagnosed terminal illness or accidents that make it impossible for lessee to genuinely carry on their business.

The farce of the present use of FMT or should we say Unfair Maintainable Trade

My apologies for running this article  again with some amendments, following a request by people involved in identifying discrepancies in the system, it has also been put on the MA Forum.

The RICS are well aware that the industry has been infected with many abuses of their system and by the use of comparables this has perpetuated the abuses until it has virtually established a Norm of high rent and rating valuation.

The serious weak link in this could be the FMT which nobody has queried in depth.

People have appealed against the calculation of FMT and had the assessment reduced, thereby affecting the rent demanded.

I raised the issue previously to gauge opinion and it was surprising how few people had viewed the issue of FMT logically.

Having just discussed some outrageous rent demands by landlords, in respect of the BII PIRSS (Pub Independent Rent Review Scheme) with aggrieved tenants in the order 20-33% where their businesses turnovers have dropped conservatively by 25% in the last two years, the FMT’s that the increases were supposedly based, bore no relation to reality and would appear to be based on a desire to regain the lost discount on the tie generated by the recession on the part of the landlord.

This raised the question of the capacity needed by brewers etc to meet theoretical demands set by the FMT across the board, which may well enter the realms of fantasy, in the difference between reality and speculation for convenience.

Theoretically if you take the overall running costs of the business annually, plus your stock purchased, you should arrive at a figure, which when deducted from total sales and other income directly derived from the pub would leave the amount of the divisible split for rental valuation.

The fact that the Pub Co’s do not allow a basic wage for the tenant and partner is highly contentious and has to be included in the net profit, in theory allowing the Pub Co to claim half the tenants  wages if a 50/50 divisible split is used.

The Brooker case has raised serious comment and thought on the 50/50 divisible split as a figure.

For mathematical convenience, we will assume a 50/50 split of the divisible balance.

Using this method you may well find that your rental level comes out to say 6% of your gross turnover, but in fact your  actual rent equates to 15% of your turnover.

Assuming a turnover of £200K your rent would equate to £12K but in reality is £30K.

If you then take the proportion of wet and dry purchases say 70% and 30% against a notional purchase figure of £100K  (assuming a GP of 50%).

(One of the cases that I viewed, the turnover was £112K, rent £26.4K with a 30% increase demanded by the Pub Co.)

The actual wet purchases figure equates to £70K, if you now multiply that by the actual rent divided by the theoretical rent 30/12 =2.5 and multiply that by the £70K, you have a theoretical sum for wet purchases £175K.

If that were the case the brewers would have to more than double their capacity.

The pubs that I have viewed in the last few weeks all fall into that category.

This would appear to leave the FMT calculations by a number of Pub Companies as unattainable and almost certainly impossible to supply.

Whether the divisible split is 35/65, 40/60 or 50/50 is incidental, the assumption by various surveyors and BDM’s that a Pub should be purchasing say two and a half times the stock that it does when there is no market for that volume, but if you add all the over calculations, the suppliers could never hope to meet that requirement.

It would be interesting to see how much theoretical over capacity has been forced on tenants in a small regional brewery, if the over estimation is within 10% across the board, this may be acceptable, if it is over 15% this is unacceptable.

It may take a few minutes to grasp the gist of this argument, but it is worth thinking about, a number of knowledgeable people in the industry agree with my thinking.

The major problem is that the majority of valuers or BDM’s look at individual pubs and not the effect collectively, they also ignore the fact that business is finite and not infinite.

For those with freehouses it raises some interesting excuses from Rating Valuers and in respect of my pubs they have had to work it out from my actual figures rather that using comparables, to my advantage.

This is aimed at being a very simple exercise to raise questions to your BDM on how fallible and hopelessly inaccurate the present system is.

At the end of the day how out of touch virtually all Pub Co valuers are in what they are demanding, since they have failed to view the overall picture.

Is there a similarity to certain companies in the Licensed Industry? I hope not.

This is a copy of a publication in the USA on Pyramid Selling, it is worth reading any similarity to any UK businesses is coincidental.

Study of Ten Major MLMs
and Amway/Quixtar
Show Huge Consumer Losses and Pyramid Recruitment

June, 2008

A statistical analysis of income disclosures made by 10 major multi-level marketing (MLM) companies and the largest of all MLMs, Amway/Quixtar, reveals that, on average, 99% of all participants received less than $10 a week in commissions, before all expenses. Additionally, the report shows that on average no net income is earned by MLM distributors from door to door “retail” sales. Total losses of the participants exceed $5 billion each year, if only the entry fees, basic business expenses, marketing “tool” purchases and the pyramid commission portion of their product purchases (about 40% of their purchase price) are totalled.

The data analyses prove that virtually all MLM participants never earn a profit and that MLM claims of a broad-based MLM “income opportunity” are false. The report reveals that the majority of all commission payments are awarded only to a small group of promoters at the top. More than 50% of all commission payments were transferred to the top one-percent in ten of the eleven companies. In several cases, more than 70% of all commissions were paid to the top one percent. The top-loaded pay plans of the MLM companies are based on “endless chain” recruiting in which the investments of the latest recruits are transferred to the earliest ones, and the vast majority of all participants are always situated at the bottom levels of the chain, where profit is impossible.

The MLMs sustain their operations by annually churning 60-90% of all participants who quit the schemes and stop purchasing the MLM products after suffering financial losses. The schemes maintain the myth of income opportunity partly by convincing the churned victims that their financial losses were their “own fault” thereby making it possible to replace them with new hopefuls, who are unaware of the loss rates and the flawed and untenable structure.

The companies studied include Arbonne, Cyberwize, Free Life, Herbalife, Melaleuca, Nikken, Nuskin, Reliv, Usana and Your Travel Business (YTB). All data analyzed were published by the MLMs themselves, though presented in difficult to decipher formats. The analysis organizes the data in a uniform format for each company that is easily understood and compared.

Five of the companies in the study are publicly traded on stock exchanges – Herbalife(HLF), Nuskin(NUS), Reliv(RELV), Usana(USNA) and Your Travel Business (YTBLA.OB). Total market capitalization of these five in June 2008 was $4.25 billion .

The total revenue of the eleven companies exceeds $12 billion. Approximately 9 million consumers worldwide invest in these schemes each year as “sales” representatives though little of the products are ever actually resold to end-users. The newly recruited salespeople become the de facto and unwitting end-users. Their own direct purchases and fee payments represent nearly all the companies’ revenue.

With at least 60% churn rates, at least 6 million new people are enrolled in the schemes each year. The annual recruitment of these six million consumers is based largely on the companies’ false offers of an “income opportunity.”

All nine million consumers sign legally binding contracts as independent contractors for the MLM companies, enabling them to participate in the schemes’ “business opportunities.” The contracts authorize them and provide incentives to potentially earn income from selling the companies’ products and from recruiting other sales representatives into the schemes.

The MLM companies are representative in type, business model, pay plan and recruitment tactics of the majority of most MLMs. The report concludes that the MLM “industry” is a significant contributor to the widening income and wealth gap in America and elsewhere. The business model and business practices of most multi-level marketing companies cause the financial losses, not normal competitive factors or the levels of efforts or talents of the participants.

MLM companies seek to obscure their devastating failure rates by disclosing the number only of “active” participants and limiting the income figures to a one-year or even shorter time frames, thus concealing the factor of the ongoing and mounting losses of new participants. If all the participants over a five-year period are included in the calculations, the failure rate rises even further. Less than one in one-thousand will be shown to have gained any profit at all. The so-called successes in MLM are in the same small group positioned, year after year, at the top of the recruitment organization.

The figures used in the analysis are from public documents of the companies themselves. The percentages and actual dollar figures have been extrapolated to a “per 10,000 sales representatives” in order to provide a more understandable picture and to match data of the companies analyzed. A larger sample is applied to the Amway/Quixtar data.

Some thoughts and ideas on in house staff training.

Some thoughts and ideas on in house staff training.

Many years ago I used to visit Monkey Island at Bray on the River Thames.

It was a delightful crazy Victorian pub/restaurant, with amazing murals of monkeys all over the walls, superb food and a terrific atmosphere.

The place was run by a very strange guy and his mother, but they had a never ending stream of very attractive, intelligent, well connected girls working there.

As a shy retiring bachelor with a fancy sports car, I got to know them all and took some of them out occasionally.

I also used to take clients there for lunch.

I was fascinated by the way the place operated, they had one chef and the girls seemed to be involved in everything, from the bar to waiting, food preparation and cooking, there was no job demarcation and it worked.

In due course I asked the girls how it worked, they had all had some form of catering training, in those days well connected young ladies did a Cordon Bleu cooking course as part of their finishing school education.

They had one excellent chef who did the speciality dishes and ensured that the kitchen ran like clockwork, the girls prepared, cooked, washed up, served behind the bar and did everything and all of them were interchangeable.

They would all take turns in every aspect of the business, including filling in when the chef was off.

They all did every job in the pub from cleaning to cooking, they all knew how to cook every dish, recipes were recorded for all to see, who ever was acting as chef ran the kitchen and did, what I call precision cooking.

I thought what a fantastic system, nobody got bored everyone knew the standard that was required and ensured that it was maintained all the time and the main point was that everyone was interested in the quality of the products from beer to the restaurant food.

I thought that if I ever bought a pub or restaurant I would do just that.

Ironically I did and we tried to implement this system so that we were never held to ransom at a chef leaving or not being available.

We had only been in the first pub for six months and found people walking in with Egon Ronay’s book in hand, in the early 70’s you had a mystery visit and the entry cost you nothing.

Our catering in those days, compared to our later pubs seemed incredibly basic, but it worked.

On a busy day at lunch time in a small pub on Exmoor we would do up to two hundred people, when I look at rural pubs these days most would be grateful for thirty people at lunch times.

We bought a pub some years later with minimal business, which in a very short time became hugely successful, at the time certain newspapers referred to us as one of the top pub/restaurants in Devon, certainly we never ever paid for advertising.

We initially struggled for staff and then we developed a nucleus of around twenty plus staff, my wife and I did the cheffing until we found a reliable chef.

We gradually trained all the staff from the cleaner upwards to do pretty well everything within their capabilities.

I asked the chef after a fortnight what he would do to improve the place and he made various comments, after six weeks he said that I didn’t need him since the staff were capable of doing everything, I said that I needed him for the speciality dishes and to co-ordinate everything.

He had been used to doing everything and now the pressure was off and he could ensure that everything worked like clockwork, in stead of having almost a spare pair of hands at the bottom of the staff list, I had a very unstressed chef and a pair of very experienced hands fine tuning at the top of the list.

He also said forget his previous suggestions, he would do what we were doing.

We had some power failures and the chef came into his own in cooking the dishes on alternative power sources and that was one aspect that he was invaluable.

The staff loved it they all became interested in quality food and would come in with ideas which we would develop, when the customers asked about a dish, they could tell them all about it and the big thing was that they all ensured that the quality of every dish that went out was right, which is essential.

We always stressed that service was included and it never ceased to amaze me some of the tips the staff got.

We were regularly booked six weeks in advance, with seating for forty eight and if they couldn’t get in for dinner they would have three course bar snacks, which could be a pain.

Sadly we went back to have dinner in our old pub, which was sold to a Pub Co, not by me.

The service was pathetically slow, the chef was trying to do everything, the waitresses could not even be called trolly dollies, had no idea about food, thought white pepper was the same as black pepper and we haven’t been back.

Staff training is vital, if you can develop a total commitment and on going interest, it makes it easy.

One of our girls that we trained as a chef, she started as a waitress, was approached for ten different restaurant cheffing jobs, much to her amusement.

If you have some good ideas to do with making a pub or restaurant work please send it to us and we will be delighted to publish it with details of your pub or restaurant, also any recipes, we have hundreds, but it is nice to promote someone else’s business in return for information which may help another licensee.

Barfly