Monthly Archives: April 2015

Latest Leisure Industry News

Latest Leisure Industry News

Luke Johnson – we’ve got to re-balance the economy away from London: Northern counties must push for the creation of a northern powerhouse if we are to revive the UK economy outside London, delegates were told at the Summit: The Future of Growth conference in London. Sector investor Luke Johnson said: “One of the biggest challenges we face is over-dependence on London. The problem is not London. We somehow need to revive the rest of the country. We’ve got to rebalance the economy away from London.” Johnson said that job creation via large scale public sector start-ups is not the answer, and the North is dependent on entrepreneurs to create the next “titans” of business.

ALMR members warned they must get everything right: With growth and confidence returning to the sector, and along with it fierce competition, operators “can’t afford to get a single element wrong,” the chief executive of the Association of Licensed Multiple Retailers, Kate Nicholls, told the organisation’s Spring Conference. Nichols said: “You have to have the right offer in the right location at the right price, and with the right people delivering it.” She promised the ALMR would continue to be strong voice in the interests of the industry, influencing as much as possible the debates before and after the coming election. “We will also be a conduit for positive news to make sure we have the best regulatory environment,” Nicholls said. A “state of the nation” report will follow later in the year, along with the launch of a “future leaders” programme and a new advertising campaign in conjunction with the Perceptions initiative “to convince young people that this is a great sector to work in.”

Crowdcube reports 31,000 new investors join platform in first quarter of 2015: The crowdfunding platform Crowdcube has reported that 31,000 new investors joined its investment community in the first quarter of 2015 taking the total to 158,000. According to estimates used by the UK’s financial regulator, FCA, equity crowdfunding was worth around £84m in 2014, up from £28m in 2013. Luke Lang, co-founder of Crowdcube said: “We’ve had a very busy and very successful first quarter, with over 15,000 individual investments made from our investors. As well as a record amount invested through the site, we’ve attracted more than 31,000 new investors to our investor community, which now stands at over 158,000 people, and raised £17.5m for British businesses. We’re extremely optimistic that 2015 will be our best year yet, as we see crowdfunding become an increasingly popular options for investors and businesses alike.

Geof Collyer – Enterprise could be worth 116% more than current share price: Deutsche Bank leisure analyst Geof Collyer has published a bullish note on the prospect for Enterprise Inns as it seeks to take a more pro-active property role ahead of the introduction of the Market Rent Only option. Issuing a price target of 215p, he stated: “Recent legislative changes that introduce a free-of-tie option for licensees change the commercial basis of the tenanted and leased pub market. Our analysis suggests that Enterprise should be able to offset any negative profit pressures, and that its evolving strategic responses will lead to eventual profit upgrades. We think that the potential changes should convert Enterprise into a more proactive, commercially minded property manager that could also encompass a partially owned REIT and a managed pub division alongside the traditional tenanted estate. We have tweaked up our price target by +5% to 215p, and remain confident that the share price should double from here. Our overriding conclusion is that Enterprise will emerge as a much more vigorous property manager, with more control over its business, and achieving a greater proportion of its tenanted and leased income from fixed rent. All of this should combine to narrow the current 65% Net Asset Value discount that the shares are trading on: a 10% ppt reduction would be worth +30p per share. Our analysis suggests that a ‘Sum-of-the-Pubs‛ valuation for Enterprise as a tenanted & leased pub business, incorporating a managed pub division and a partially demerged REIT could be worth +116% more than the current share price.”

Note:- Some of us have been saying this, but we have grave doubts as to whether they can work with their tenants as a team, until they understand a licensees viewpoint and work together, it will continue as a them and us situation.

The MRO if used sensibly could unite the leased industry.

CGA research reveals growing importance of cocktails in on-trade: High-alcohol cocktails are being replaced in drinkers’ affections by more indulgent drinks, elaborate combinations and lighter versions – although cocktails are increasingly important to the on-trade with volumes up 4% in six months. These are among the topline findings from The Mixed Drinks Report, the annual survey of the market by CGA Strategy. It reveals sophisticated and lower strength drinks like the Espresso Martini have risen in popularity among consumers over the last six months, while other more established serves including the Long Island Iced Tea have fallen slightly out of favour. The report also highlights the rising popularity of ‘skinny’ and light mixed drinks, with a fifth (20%) of frequent cocktail drinkers now saying they always prefer to order one. Both trends are likely to continue through this summer, the peak trading season for cocktails. Other key trends revealed in The Mixed Drinks Report include: The mojito remains the UK’s favourite cocktail, with 41% of respondents saying they like to drink it; vodka is the most commonly used spirit in cocktails – but speciality spirits are now close behind in second place; cocktails are most popular among women – but men enjoy them too. Half (52%) of women say they drink cocktails, and a third (35%) of men. The report confirms the huge importance of cocktails to the on-trade now. The volume of cocktail sales has risen 4% in the last six months – this is in contrast to total wet sales which are down -7% versus the previous six months. CGA Strategy’s research also highlights opportunities for the on-trade to get a greater share of the cocktail market. Cocktail promotions are a big driver of footfall, with four in five people (80%) likely to visit a venue because it was running one. Two in five (39%) are meanwhile influenced in their choice of drink by bartenders’ recommendations. Price is an important consideration too, and a third (34%) of those who don’t drink them say they are put off by the expense. Tom Lynch, commercial director at CGA Strategy, said: “Our latest research further reinforces the scale of the cocktail category and the breadth of cocktail consumption when people go out to drink. We’re now seeing a far greater variety of serves making their way into the consumers’ repertoire, with more adventurous flavours and increasingly sophisticated mixology now permeating the mainstream for the first time. We’re also seeing the rise of healthier, lower strength serves mirroring similar trends that we’ve seen in wine and beer, providing operators with a challenge; extend your menus to meet increasingly diverse customer expectations, while maintaining cost control in a challenging category to deliver efficiently.” The Mixed Drinks Report is available now. For more information, call 0161 476 8330 or visit

Enterprise Inns to update on new strategy: Enterprise Inns will be reporting interim results on 12 May 2015. Alongside the presentation of results, the company will also be updating the market on its strategy for maximising long-term value from its estate. This strategy update will illustrate the actions management has been taking to create a more flexible business model with which to grow value for shareholders. Whilst retaining the tenanted pub model at the heart of its business, the update will outline the progress Enterprise is making to build complementary managed and commercial property estates. The review follows a detailed assessment by the board over several months to ensure that the company is best placed to adapt to the structural changes likely to affect the industry as a result of the forthcoming Statutory Code and the anticipated introduction of a “Market Rent Only” option. A presentation for analysts on the results and the strategic review will take place on 12 May 2015 at 9.30am at Deutsche Bank, Winchester House, 1 Great Winchester Street, London.

Scottish health promotions body raising legal age for buying alcohol to 21: NHS Health Scotland, the Scottish government’s health promotion agency, has proposed increasing the legal age for buying alcohol to 21 to combat binge-drinking. The idea is contained within a report titled “Best Preventive Investments for Scotland – What the Evidence and experts say”. The report argues that to “increase the minimum legal drinking age to 21 would be highly cost-effective as it would both improve people’s health without having to spend much money and reduce demand on the NHS”.

Latest Food News, Mid April

Personal injury lawyers probe Toby Carvery norovirus incident: Personal injury lawyers have got involved a suspected norovirus outbreak at a Toby Carvery pub and restaurant in Exeter. A hundred customers and staff fell ill at the Toby Carvery and hotel in Middlemoor in the run-up to Easter. The personal injury firm Irwin Mitchell said it has been approached by ten people. The restaurant, which had temporarily reopened on Friday, is currently closed. An Irwin Mitchell lawyer, Amandeep Dhillon, said: “We have now heard first-hand accounts of the issues which people have faced after falling ill following visits to this pub and are now making our own enquiries to learn more about these problems. Through our work, we have seen numerous cases in which people have been forced to take time off work or faced further disruption in their lives as a result of illness outbreaks, as well as how such issues can leave victims with long-term health complaints.”

Top restaurateur bemoans state of French cuisine: Almost three quarters of all dishes served in French bistros, brasseries and cafes are shipped in from a factory and microwaved, according to a top restaurateur. Xavier Denamur sparked fury after he exposed France as a country of microwave cheats and even went as far as to compare it as being the culinary equivalent of a low-cost airline. The French government is so concerned that it called on two multi-Michelin-starred chefs to draw up battle plans. Chefs Alain Ducasse and Guy Savoy have now put together a 20-point plan, but admit that France’s global culinary influence “is no longer the same”. The chefs recommended stricter criteria should also be introduced on food with a “home-made” label in restaurants, which can currently allow most frozen and vacuum-packed food. Last year the French government passed a law which was meant to force restaurants to label the dishes they prepare from fresh ingredients in their own kitchens as “fait maison” (homemade). But ministers have been forced to admit that the law had failed, as diners had little faith in the new label. The new law was criticised for not going far enough, as restaurants were still able to use ingredients such as factory-made pastry and claim the food was homemade.

Operators warned of danger of hidden gluten: Research has revealed that nearly three out of five people do not realise that not all chips are gluten-free, meaning operators could be inadvertently serving gluten to coeliacs. With seven out of ten people opting for chips as their preferred gluten-free side out-of-home, the food brand Aviko is urging caterers to take a second look at their potato sides and the gluten that could potentially be hiding in the 4.6 million daily servings. Mohammed Essa, Aviko’s general manager, said: “With the recent allergen legislation coming into effect, it’s never been more important for operators to be fully aware of what’s on their menus. Though potatoes themselves don’t contain gluten, how and where they are prepared means that operators could be unintentionally serving gluten to customers, which can mean serious side-effects for those with an intolerance.” Independent research, commissioned by Aviko, which looked into the demand for gluten-free menu options, highlighted the importance of offering coeliac-friendly choices. With six out of ten people wanting to see more gluten-free options available on menus, Aviko said there was a clear profit opportunity for operators who cater for the one in every 100 people diagnosed with coeliac disease.

Nine out of ten diners want more frequent menu changes: The vast majority of diners – 86% – would like to see more frequent menu changes when they eat out, research by the guest experience management company HospitalityGEM has found. Two thirds of those surveyed by HospitalityGEM said they would expect at least quarterly seasonal menu changes in restaurants and pubs. Independent restaurants are under even more scrutiny, with 50% of diners surveyed expecting multiple changes to the menu every month. This is putting increased pressure on operators of these sites as guests are now expecting a different dining experience on every visit, HospitalityGEM said. However, this does not mean that the menu needs to be completely re-worked every time, as four out of five diners surveyed already know in advance what they are going to order from their chosen eatery, with three in four picking a venue purely for a specific dish on that restaurant’s menu. This clearly demonstrates the pulling power of a site’s hero products, and the value of building a reputation for doing certain favourites consistently well, HospitalityGEM said. Steven Pike, managing director of HospitalityGEM, said: “The frequency that menus need to change has always been a difficult question, weighing up the loyalty of diners to a certain dish against the need to remain on trend with seasonal produce. From this research it is clear that the need to change a menu completely should never be an option, as many guests do come in looking for that one signature dish. The key here is identifying the dishes that shouldn’t change, and training your staff to shout more about the new dishes, as the old favourites will sell themselves.”

NPD – demand for value/quality means brands edging out independents: Competition from value-for-money foodservice chains has left Britain’s independent operators with a much lower share of Britain’s eat-out traffic – down from 53% at the end of 2008 to 43% at the end of 2014, according to NPD Group research. The research shows that, when Britons eat out, they are much more demanding when it comes to good prices and good quality than they were a few years ago. At the end of 2008, when grabbing a snack-on-the-go from a high street outlet or sitting down for a more formal meal, less than 9% of Britons said they chose an outlet for its good prices, but by the end of 2014 that had shot up to over 25%. The need for quality of food is higher too, with 21% of consumers saying this is why they choose an outlet compared to 17% six years ago. More consumers are also saying that their choice of outlet is affected by the availability of a ‘good variety of foods’ (12.6% year ending 2014 versus 11.4% six years earlier).The insistence on price and quality is taking a big bite out of the business of independent foodservice operators. Since 2008, independent high street restaurants and other local food outlets have seen sales drop by -22.8%. In stark contrast, restaurant chains have grown traffic by +15.5% in the same period. At the end of 2014, independents represented only 43% of eat-out traffic, down from 53% at the end of 2008, a steep drop of nearly ten percentage points. The British out-of-home foodservice market was worth £50.7 billion at the end of 2014, with chains taking £27.5 billion of this. “Britain’s independent restaurants and food outlets are struggling and the trend is likely to continue,” said Cyril Lavenant, NPD Group Director of Foodservice UK. “Most of them are not meeting expectations on price and quality or offering the full experience for which chains are known. The high street is more and more competitive and offers clear value for money while independent foodservice operators face more pressure than ever in this respect. Many of us know a restaurant or café or sandwich bar that has closed recently. To survive, independent outlets will need to offer good food and good service at a good price, bring more excitement and keep up with the current trends.” The decline in the fortunes of independent foodservice operators is evident across all age groups except for those over 65 years of age, showing how our traditional independent food outlets are struggling to maintain their appeal among younger customers and families choosing to eat out of home. Independents still rely on their customers making a choice for eating out based on convenient location (42%) and the sheer habit of visiting a favourite restaurant (27%). This makes them vulnerable to their chain competitors who are expanding their operations based on a more compelling formula of value for money, quality and variety of food. Part of the wider group of foodservice chains, Britain’s casual dining brands are doing especially well in terms of customer satisfaction. NPD said the brands – including Nando’s, Frankie & Benny’s, PizzaExpress, TGI Friday’s, Wagamama, Gourmet Burger Kitchen, Cafe Rouge, Zizzi, Bella Italia, Giraffe – offer consumers a fresh alternative to traditional fast food and focus more on food quality and service, as well as ambiance, décor and design. For the year ending 2014, casual dining brands were up +6.8% in traffic terms compared to the year before. Setting new high standards when it comes to eating out, Britain’s casual dining brands record a huge customer satisfaction score of 77% for ‘overall experience’.

Latest comments from the Sages of the Industry

Subjects: The impact of increasing graduate numbers, lager as a pioneer, and alcohol and the election and others.
Authors: David Martin, Martyn Cornell and Paul Chase

Where once the mass market meant blue-collar workers with minimal education, today graduates make up almost half the workforce, something consumer-facing companies have to take on board, says David Martin

I was lucky. In my youth, I was among the one in 20 of my generation fortunate enough to get a university education.
Nowadays, to borrow the title of a recent Economist article, “the world is going to university”.
After a tripling of the number of full-time undergraduate students in the UK since 1970, over 40% of people currently aged 25 to 34 in England and Wales have achieved at least degree-level qualifications, against only 23% among the over-50s.
More reasons I was lucky: I did not have to live with my parents into my late 20s, I had no student debt, and I didn’t have to take a “non-graduate job”. But, setting aside those contemporary problems, in the Trajectory Partnership’s words, we now have “the best educated generation in history” and while many things are attributed to “Millennial” consumers, this educational step-change is arguably the significant driver behind their behaviour and attitudes.
As they mature, the influence of the higher-educated in society, and their market power, will therefore grow significantly. But these consequences are far from equal across different categories, brands and retailers.
Data on the exact significance of graduate consumers in the out-of-home market is not easily available but let us keep it simple and make a reasonable assumption that in the mid-1970s, graduates accounted for a very small proportion of on trade business, and now they could account for 40 to 50%.
But that is just the numbers. We have to load in two other powerful factors: first, attitudes and aspirations, and second, influence – or in current parlance, “social capital”. Put simply, graduates increasingly set the agenda. They will become, if they have not already become, the dominant consumer voice. Move over Boomers. Here come The Graduates.
The mainstream “blue collar” market may have been dominant in the past, but brands and categories that align with, or are still associated with it, are now facing a serious challenge. Just consider the evident changes in the beer market for example. This argument carries weight both sides of the bar. An age-old adage is that your staff (and management) should mirror your customers. As the pub market steadily moves away from its historical blue collar roots, not least because of the long-term rising real price of pub drink, it is worth asking whether enough graduates have yet been attracted into unit management.
Recent news coverage of the Campaign for Real Ale’s National Pub of the Year winner, The Salutation in Gloucestershire, noted that the licensee is a 31-year-old psychology graduate. His thoughtful views on the pub (individually and generically) featured in a Daily Telegraph piece, which duly observed that his success “may speak more to the trade’s future than its past.”
There is a geographical dimension to this issue, too. It was put in sharp focus by a recent Centre for Cities report, identifying the tendency for graduate jobs to cluster in advantaged cities with knowledge-based economies – those that have prospered most, and will continue to do so, due to the quality of their employment base. Outside the capital, these prospering cities are the routine base camps for growing chains coming out of London, such as Brighton, Cambridge, and Reading. At the other extreme are northern and Midlands towns historically dominated by declining low-knowledge industries, where jobs have been replaced by lower-skilled, more routine employment, places like Burnley, Bradford and Birkenhead.
On-trade outlet data for these two sets of sharply contrasting sets of towns is telling. Figures from CGA Peach shows that the number of food led outlets in Brighton, Cambridge and Reading grew by 18% from 2005 to 2014, while in Burnley, Bradford and Birkenhead they declined by 2%, despite the societal trend to more eating out.
Away from the supply side, there are hugely significant demand consequences of the rapid rise of the higher-educated, and they are inextricably linked to the macro-trends of individualisation, independence, and aspiration.
If we accept that higher education teaches and empowers you to think for yourself, then logically it cultivates the confidence to fashion your own identity, to have less need to be part of the crowd, or to be told what to buy, or when to buy it. Hence we see Millennials’ interest in unique and diverse products – multiple choice is their mode – and their social media-enabled self-sufficient approach to “self-service” product knowledge. Perhaps most obviously, more education sows the seeds for more discernment and for higher aspirations, fuelling the premiumisation trend evident in so many markets.
For a category case-study, consider the transformation of coffee consumption in the UK where, in the view of Jeffrey Young, managing director of Allegra Strategies, “artisan cafe culture is becoming the norm”, and where the instant coffee category, skewed to the older generations, is in retreat.
Similarly these factors have been key pre-conditions for the growth in craft beer, a category skewed to higher-income, younger consumers, who are also likely to be higher-educated. Part of the success of “craft” beer is that it enables its drinkers (“us”) to position themselves away from mainstream brands (“them”).
This is just as relevant to fast food, or soft drinks, as it is to beer. There is no shortage of evidence that the big beasts of the brand world are facing a market share challenge from a myriad of small, emerging and often more premium alternatives, an explosion of choice that has been facilitated by the boom in receptive, higher-educated consumers.
We are essentially seeing the consumption consequences of Tony Blair’s mantra, “Education, Education, Education”. The graduate boom is, so far, still specific to the younger age-cohorts, but unless we see an unlikely reversal of the strategy by future governments, ultimately the symptoms described here will apply to all generations.
That is not just going to be a tough examination for businesses, categories and brands that were traditionally strong among the old blue collar population, but also for those that “overtrade” with the mainstream over-50s, such as pub dining.
You can start your answer now …
David Martin is managing director of Red Circle Insight, a market and customer insight resource

Two pillars of a pioneering venture by Martyn Cornell

Down a quiet street in Tottenham, North London is a sheltered housing scheme called Portland Place. At the entrance to the scheme stand a pair of brick gateposts supporting big, heavy, wrought-iron gates, all obviously much older than the flats and bungalows that lie beyond. There is nothing to tell you what those gates represent: but they are, in fact, the last physical remains of the Austro-Bavarian Lager Beer Brewery, a brave but ultimately doomed attempt to interest the British beer drinker in continental styles of brewing, all of a century before pale, chilled brews from the continental tradition finally did triumph on this side of the English Channel.
In the second half of Victorian England, lager was, in a surprising number of ways, the craft beer of the age. It was certainly expensive – Anton Dreher’s Viennese Marzen beer sold for six (old) pence a pint in the Vienna Beer Saloon in the Strand in 1869, at a time when ordinary mild ale was just two pence a pint, a price that caused considerable criticism in British newspapers. By the 1880s it was sold in places such as the Tivoli, another German-style drinking establishment in the Strand described as “an open-fronted tavern”, which sold “Vienna steaks”, beef patties effectively identical to hamburgers.
By 1881, according to one German writer, it had become impossible to walk down any street in London without seeing a sign advertising LAGER BEER. It was in this spirit that the Austro-Bavarian Lager Beer Brewery and Crystal Ice Factory was registered in June that year to build a new brewery at Grove House, a former boarding school in Tottenham which had a railway line on its western side and a main highway – later designated the A10 – on the other. The eight-acre site had its own well, and all the employees, “down to the ordinary labourers”, were German.
According to the medical journal The Lancet, reviewing the company’s products in 1884, its beers included a Pilsner, “a light table ale”, and a Bock and a Munich lager which “are akin to porter and stout”. The Lancet also revealed that the beers were available on draught, “aerated by a force pump, which brings it to the tap.” The Lancet liked the idea of lager being available in Britain: “considering its lightness and excellence, we are glad to see its popularity increasing so rapidly.” However, the “peculiar flavour” of the beers, The Lancet said, “compared by some to garlic and by others to curry, is, we believe, generated by the manufacture, and is liked by those who are used to it.”
Although imports of lager had almost doubled between 1879 and 1881, to just under 14,000 barrels, the Austro-Bavarian Brewery does not seem to have been hugely successful, since in 1886 the company that owned it had to be liquidated and it was re-launched as the Tottenham Lager Beer Brewery. In 1890 the brewery acquired the old Vienna Beer Saloon in the Strand, now known as Darmstatter’s, after the man who had bought it around 1880. Darmstatter’s was renamed again, as the Tottenham Lager Beer Hall. Five years later, however, in 1895, the Tottenham Lager Beer Brewery itself went into voluntary liquidation, tens of thousands of pounds in debt, and the lager beer hall on the Strand was knocked down and rebuilt as an English pub-restaurant called Fleming’s The brewery rose again in February 1896 as the Imperial Lager Brewery, but closed finally in 1903. All the same, an operation called the Imperial Cold Stores Co seems to have run on the site until the 1980s, a last echo, together with those gates, of Britain’s first purpose-built lager brewery.
That was not (yet) the end for lager sales in Britain, however. An excellent e-book called Gambrinus Waltz: German Lager Beer in Victorian and Edwardian England, by Ray Bailey and Jessica Boak, details the lager bars that sprang up in the West End of London from the late 1870s, and the way lager had become a staple in stylish cafes and restaurants by the end of the 1880s. The Spaten brewery of Munich, one of the pioneers in the 1830s of the new style of lager brewing that had conquered Europe in the following 20 or so years, being imitated by, among many others, the founders of the Pilsner Urquell brewery in Bohemia, Jacob Jacobsen of Carlsberg in Copenhagen and Gerard Heineken in Amsterdam, opened a beer hall in Charing Cross Road in 1891 that became so successful a larger venue was opened in 1895 in Piccadilly Circus. The most famous lager outlet in London, however, was the Gambrinus in Glasshouse Street, just off Regent Street, which was highly popular with the fast set.
So where did it all go wrong for lager, the great fashionable drink of the late Victorian and early Edwardian era? The problem, according to Bailey and Boak, was the steady rise of Germany, land of lager, as an economic and military threat to Great Britain. By 1909 or so, the lager bierhalls of London were beginning to be spoken of as homes from home for German spies. When war actually broke out in August 1914, the Gambrinus was swiftly turned into the Café Brasserie, the German waiters replaced by Frenchmen, and the lager on sale was brewed in Holland.
It would be another 50 years before lager began to make any sort of impact on the British pub scene, for reasons which seem more likely to do with British conservatism than with world wars. Eventually, though, the victory was overwhelming: the pioneers of the Austro-Bavarian Lager Beer Brewery could only have imagined it in their dreams, but today, in the pubs of Tottenham and elsewhere around Britain, three pints in every four is lager.
• Gambrinus Waltz: German Lager Beer in Victorian and Edwardian England by Ray Bailey and Jessica Boak is available for Kindle for £2 from the Amazon UK website
Martyn Cornell is managing editor of Propel Info

Tails wagging dogs by Paul Chase

When one views the manifestos of the political parties currently competing for our votes it should come as no surprise that the further to the ‘left’ the party, the more in thrall that party is to ‘healthist’ ideology. This is because the new public health movement (NPHM) isn’t really about public health, it’s about social control; it’s about the denial of freedom of choice and the imposition of lifestyle regulation. The NPHM is instinctively anti-business and believes that only the state can provide solutions to our public health dilemmas. This is evidenced by their mealy-mouthed rejection of the achievement of taking one billion units of alcohol out of circulation ahead of time, under the voluntary industry responsibility deal. It is also evidenced by their suspicion of, and ambivalence towards the advent of electronic cigarettes – a private sector solution to a public health problem.
It looks like we’ll have another hung parliament. This prospect has created a variety of tails queueing up to wag the dog. And with the exception of UKIP and the DUP, these parties are uniformly left-wing. The SNP, Plaid Cymru and the Green Party all have the following in common: they are deficit-deniers; they are unilateral nuclear disarmers, and they all believe in minimum pricing and a greater involvement for ‘public health’ in licensing and in reducing the availability of alcohol.
The Labour Party, which has moved to the Left under Ed Miliband’s leadership, has also bought in to the healthist ideology. The World Health Organisation, which is a disguised version of the old Trotskyite Socialist International, advocates a “health in every policy” principle, and Labour has fallen for this soundbite and proposes to set limits for the amount of sugar, fat and salt in food marketed “substantially to children”. Well, good luck with that one! The point about “health in every policy” is that it’s a disguised way of saying that so-called public health concerns must trump every other consideration – so that public health becomes the organising principle of our society to the detriment of the economy and jobs. The NPHM is a repository for these frustrated, infantile leftists who are dismayed at the demise of the old Soviet system, have no alternative to capitalism, but who now seek to advance their statist, social control agenda using ‘public health’ as the vehicle.
Labour wants to crack down on high-strength, low cost alcohol that “fuels binge drinking and underage drinking” – even though the incidence of both have fallen quite dramatically. This is another example of seeking today’s solution for yesterday’s problem in order to strike a symbolic pose. Labour also wants a public health licensing objective. Add to this their determination to give local authorities power to limit the number of fast food outlets locally and their nanny state, petty Gauleiter direction of travel becomes clear. Just for balance, I should mention that at least a Labour government would get rid of local Police and Crime Commissioners, and we could save a modest amount of money that would otherwise be wasted on failed local politicians seeking a last-gasp opportunity to graze on the public funding meadow.
What of the Conservatives? There are signs that notwithstanding the 2012 Alcohol Strategy that contained measures taken straight from the Daily Mail playlist, that the Tories do ‘get it’ in relation to the contribution that our sector makes to the economy and to employment. Three successive years of alcohol duty cuts and the abolition of the duty escalator have been well received. The Tories have rejected, for now, locally set licensing fees and have recently suggested that fees for Class A and B properties would be frozen at the current level to help reduce costs. This is altogether a much more licensed trade-friendly environment. Unfortunately, their previous extension of the status of ‘responsible authority’ to include local health authorities opens the door to the introduction of a health objective, and I suspect that the Tories have painted themselves into a corner on this one.
The Liberal Democrats deserve a mention (well I suppose!), if only because they have in general been even more hawkish than Labour in advocating measures such as automatic loss of premises licences for even one failed test purchase. And I still haven’t forgiven them for trying to nationalise 75,000 pubs in 1908!
For me the biggest issue in the general election is, or ought to be, the deficit. Our National Debt has risen from £700 billion in 2008, to £1.5 trillion by 2010 and is now just south of £1.9 trillion. Interest payments on this debt alone gobble up £30 billion a year of taxpayers’ money. If we could create an annual budget surplus that would enable us to reduce our structural deficit – the National Debt – by just 10% a year then the savings on our interest payments would go a long way to solving the funding crisis in the NHS over the lifetime of the parliament – and perhaps we would see an end to ridiculous claims that “binge drinking will bankrupt the NHS”. The problem with hung parliaments and coalition governments is precisely that they encourage a combination of economically illiterate, wide-eyed idealogues to believe that if only their tail could wag the dog then their Trotskyite business-bashing pipe dreams could be advanced.
Paul Chase is a director of CPL Training and a leading commentator on on-trade health and alcohol policy

Carluccio’s shows the way forward on the beer menu by Martyn Cornell

It was with great pleasure I saw this week, four months after I criticised the chain on this forum over its beer selection, that Carluccio’s is now selling Italian craft brews, stocking bottles from the highly admired Birra Del Borgo in Lazio in all its 88 sites.

I’m not so big-headed as to think that my Propel opinion piece had any influence in Rose Street. It’s much more, I’m sure, the way the best operators in the UK of “overseas” food offerings make it an important part of their business to keep up with what is happening in the country from which they take their inspiration. It’s part of the DNA of Britain’s growing American-style barbecue restaurant scene that the owners of US-inspired barbecue outlets take regular road trips through the southern United States to discover new ideas. Similarly, as Michael Stocks, Carluccio’s international operations manager, indicated in the story Propel ran on Wednesday on the change to the chain’s beer menu, an organisation like Carluccio’s knows the importance of introducing new food and drinks to its customers.

If you visit Italy now, with the specific intention of seeing what is happening in the world of Italian gastronomy, you cannot fail to notice how the Italian craft beer scene is booming. Call in at Eataly in Turin, for example, and you will find beers from a host of top Italian craft brewers on sale, not just Del Borgo, but Le Baladin from Piedmont, L’Olmaia from Tuscany, Ichnusa from Sardinia, Antoniano from Padua, Sao Paolo from Turin and others. The Slow Food Movement ‘s University of Gastronomic Sciences near Bra in Piedmont now runs courses in beer appreciation. (Declaration of interest: some of the course material is taken from my book on the history of beer styles, Amber Gold and Black, translated into Italian.)

What is particularly interesting is to see how many Italian craft brewers, including De Borgo, have rejected the standard beer bottle, and are using a variety of attractively shaped flasks to present their beers in: these are drinks that will grace the table with their stylish presentation, as well as their food-enhancing flavours. I suspect the fact that Del Borgo’s beers did not come in the usual boring bottle played a part in Carluccio’s choosing them for its menu. This is a trick only Meantime Brewing among British brewers seems to have picked up on, with its smaller bottles shaped like the top third of a bottle of wine.

As I said back in December, newer chains in the UK, mostly, seem to get the fact that the beer offer can no longer be an afterthought, or the obvious choices that can be found in any corner grocery store (though, in fact, most corner grocery stores have considerably more interesting beer selections than most restaurants). Carluccio’s move to stock beers from Del Borgo is an indication that more established chains, too, are catching up.

As usual, the United States is in the lead. The same day Propel carried a story on Carluccio’s new beers, we also ran a story on how casual dining chains in the US are opening up their drinks menus to local microbreweries. Buffalo Wild Wings, the casual dining and sports bar operation that has more than a thousand outlets in the US, Canada and Mexico, has actually hosted “tap takeovers” at is restaurants, where a single brewer supplies half a dozen or more draught beers for just one night, an event designed to pull in the beer geeks as well as give the regulars something extra, but which is entirely associated with specialist craft beer bars in the UK, not restaurants.

In a slightly different approach, the Florida-based Smokey Bones Bar and Fire Grill chain, for example, which has 65 outlets, is deliberately differentiating itself from its rivals through its drinks offering, which includes a hefty swath of craft beers. According to Mike Herchuck, the chain’s manager of beverage, “Our beverage offerings set us apart from the typical casual dining establishment. We have over 40 beers, including 20 American craft brews, seven of which are rated 90+ from Beer Advocate [the US beer rating site]. We also have over 40 variations of spirits that are available in every Smokey Bones restaurant, and our cocktail menu is constantly evolving with changing beverage trends. There’s always something new and delicious to try, and a talented bartender to mix, muddle, shake, or pour it for our customers.”

“A talented bartender” – there’s a phrase to set off an entire new discussion about what British restaurants could be doing to stand out from the herd. In the meantime, I’m just glad I can agree to accompany my wife down to the local Carluccio’s with an extra bounce in my step, knowing there’ll be something worthwhile to choose from among the beers now.
Martyn Cornell is managing editor of Propel Info

Predictions for the future of the pub and restaurant market by Ann Elliott

“What do you think is going to happen in the pub/restaurant market?” is a question I have been asked four times in the past week.

It’s a really interesting question, particularly after Greene King’s deal with Spirit, the new senior management team at Mitchells & Butlers, the highly successful Paul Flaum moving into the top spot at Whitbread Hotels and Restaurants and the moves by family brewers and Enterprise Inns into managed houses.

I think this sector has some challenges ahead (not including gastro-pubs with great food propositions) many of which are due to the impact of the growth of the casual dining restaurant sector

1 Expansion: CGA recently said that 8,600 food-focused outlets (although not necessarily just “casual dining” and including many food pubs) have opened in the past decade. Industry reports suggest that the ten major casual dining groups will open 200 sites just this year. A very quick and dirty add up of all the non-retail food outlets promised by operators, would lead to around 1,000 new sites opening in the sector this year – with less than 20% of these being pubs. Casual dining will be increasing its share of the total eating out market this year, if this is to be believed.

In Milton Keynes for example, the leading casual dining chains have opened five new sites by the football stadium. If they each take £25,000 a week, that is more than £6m in a year in additional spend on eating out in the area. Not all of that will be incremental: it has to come from somewhere and I suspect much of this will come from pubs.

I don’t think it is too radical to say that for many consumers, even new pubs can seem just a bit “yesterday” when compared to the other new options opening.

2 Freshness: The casual dining brands can be very nimble and quick with refurbishments. They often have smaller sites, but with similar cover levels to many pub restaurants, and therefore refurbs cost them less and they can do them more often. Gone are the days when sites would be fully refurbished every seven years with a sparkle at four. These brands move very, very quickly.

3 Accessibility: Casual dining brands do not tend to be destination sites in their own right. They are increasingly locally available to consumers and are often the new thing(s) in town. That makes them very attractive to early adopter consumers

4 Affordability: Recent comments by the Restaurant Group’s Danny Breithaupt suggested that an improved economy was encouraging some trading up, or perhaps even trading back, to restaurants from cheaper, presumably value-pub options. This would be supported by recent visits.

5 Relevance: As a broad generalisation the cuisine profile of casual dining restaurants is more aligned to contemporary, younger tastes: less deep-fried, gluten-free, less “tabloid”/huge-portioned, tastier and more aromatic, healthy/feminine and so on. They are also more future-proofed as a result.

6 The experience: When casual dining restaurants open close to cinemas, travel, leisure and retail locations, customers can more easily incorporate these brands into their overall leisure experience. They can walk from place to place, they do not have to get back in their cars. Life is made easier for them. It helps to create a real experience from their precious time out. I have seen casual dining brands excel at creating fantastic experiences inside their restaurants: think Dishoom in Kings Cross, London or Thaikhun in Manchester. I remember Spirit boss Mike Tye, years and years ago, bringing “experience” into Beefeater with moving mannequins – perhaps it’s all coming back?

7 Reduced dependency on drink: Slightly more contentious perhaps, casual dining chains are less aligned to beer and alcohol. What would happen if England and Wales followed Scotland’s lower drink drive limit? Food pubs are very dependent on car-borne visits, and south of the border we have a much stronger historic legacy of drive-out semi-rural pub dining. The drinks ranges in casual dining chains often include a wide choice of coffee, interesting teas, raw juices, milk shakes, fresh juices, non-dairy options. The non-alcoholic offering of most pubs is still in the dark ages.

This year will be an interesting one for the brands in the pub/restaurant market. One thing is certain: the continued rise of the casual dining restaurant sector.
Ann Elliott is chief executive of the leading sector public relations and marketing agency Elliotts –

Public health and the theatre of the absurd by Paul Chase

It is hard to know whether to laugh or cry. The list of anti-alcohol measures either in the legislative pipeline or proposed by the usual suspects gets longer and more absurd by the day. OK, we are in the middle of an election campaign so we can expect a few loons to chuck kites in the air, but consider the following:

In Scotland the strangely titled Air Weapons & Licensing (Scotland) Bill is still wending its way through the Scottish Parliament. An amendment has been proposed, without consultation, which would see local authorities required to block bids for new premises licences if applicants cannot demonstrate that they will have measures in place in their operating plan to reduce the consumption of alcohol. Isn’t it enough to have “public health” as a licensing objective and to require premises to make wines and spirits available in smaller measures? Nope – someone hoping to run a commercially successful bar or off-licence must first satisfy a licensing board that they have a sales resistance policy. I know a good business opportunity when I see one: I shall spend the weekend writing a course for bar-staff in down-selling! And this hard on the heels of the reduction in the drink-driving limit, which has seen pub sales fall as much as 10%.

Staying in Scotland we have the resurrection of an old prohibitionist proposal that first surfaced after the Licensing (Scotland) Act 2005 went live in 2009, namely that the minimum age for purchasing alcohol should be raised to 21. As reported in Propel on Tuesday 7 April, NHS Health Scotland, which is the Scottish government’s health promotion agency, has re-floated this old measure in a report titled “Best Preventive Investments for Scotland – What the Evidence and Experts Say”. The report argues that to “increase the minimum legal drinking age to 21 would be highly cost-effective as it would both improve people’s health without having to spend much money and reduce demand on the NHS.”

And in the process bring us into line with the United States which is the only nation outside of the Islamic world to operate a policy of partial prohibition by denying a category of adults – 18-to 20-year-olds – the right to buy beverage alcohol. Do we really have to go through the dreary process of asking why is it OK for 16 and 17-year-olds in Scotland to vote on whether to break up the Union, but not OK for 18 to 20-year-olds to buy a beer? I mean, really?

But anything the Scots can do we English and Welsh can do better! Plaid Cymru has included minimum unit pricing in its general election manifesto, even though licensing in Wales is not a devolved matter and regardless of the decision on its legality that is pending in the European Court of Justice.

And then there is dear old Professor Sir Ian Gilmore of the Alcohol Health Alliance. In the wake of the rumour that Diageo, or more accurately its brand Guinness, is set to sponsor Premier League football, Gilmore has called for a ban on sport sponsorship by the alcoholic drinks industry. On Radio 5 Live he debated the excellent Christopher Snowdon and claimed that it is “immoral” for Guinness to do this because children would see the adverts when they watch footie! So, Little Jonnie will cast aside his milk-shake and imbibe some Guinness instead – which will then become the drink of choice for all 15-year-olds!

Finally (because I’m running out of indignation) there is a report in the Daily Telegraph that life expectancy for women has suffered a drop on a scale not seen for decades. According to Professor John Ashton, president of the UK Faculty of Public Health, this is down to “lifestyle factors”. “One of the issues we have seen is women living lifestyle’s becoming more like those of men over recent decades, with more smoking and drinking,” he said. But hang on – we’re not talking here about life expectancy at birth, which continues to rise, but life expectancy at an advanced age – 75 years and above. Apparently the average woman aged 75 can now expect to live a further 13.1 years, which is a full five weeks less than in 2011. For a woman aged 85, average life expectancy is now a further 6.8 years – a fall of two and a half months, in two years.

There is not a shred of evidence that smoking and drinking are responsible for this, but every health issue can handily be blamed on fags and booze – even a five-week drop in life expectancy of a 75-year-old granny! The public health arena really has become a theatre of the absurd.
Paul Chase is director of CPL Training and a leading commentator on health and alcohol policy

Another Pub Co Rip Off for departing Tenants/Lessees (Barrel-Dregs 277)



 Barrel-dregs 3

Another Pub Co Rip Off for departing Tenants/Lessees (Barrel-Dregs 277)

A year ago we ran an article about a Pub Co tenant who had sold his lease and the Pub Co had failed to refund all his retained monies, for no good reason.

Another tenant has fallen foul of the same “Rip Off” with substantially more money involved.

It would appear that this is standard practice with many Pub Co’s.

The tenant had been with Pub Co for a number of years, ran an excellent pub, yet struggled for the last few years and decided to get out, not a problem.

Knowing little about giving up or selling tenancies they contacted USE at for advice on what might be involved.

We pointed out that they needed to contact a Valuer and take legal advice and help on giving up the lease, perfectly normal practice.

Bearing in mind that their financial position was precarious, but safe in the long run when everything was completed, they had a meeting with the Pub Co.

Smooth words, the Pub Co would  appoint their Valuer, which the tenant would pay part of the Valuers Fees and the whole transaction would sail smoothly through like silk.

“Lambs to Slaughter”, springs to mind.

The tenant tells their Valuer that he is no longer needed, saving them money, they don’t need a solicitor because the Pub Co have agreed to take the tenancy back and have a new tenant to take over, wonderful!

The tenant receives a letter from the Pub Co saying that all outstanding monies will be paid at 28 days, she can cope with that, 28 days comes and goes, two weeks later still nothing.

A further added note saying that they will only pay when the tenant has deregistered from VAT, if they are both registered for VAT, this is a circular transaction, if the tenant is not registered, then supposedly the Pub Co does not have to add VAT on, saving its cash flow.

At this stage the bank is giving the tenant a hard time and charging 18.4% on their overdraft, VAT is due to be paid and many other bills, they are totally screwed.

The smooth talking Pub Co mouthpiece is unobtainable and when located totally useless, Pub Co policy.

Behind the scenes in the Pub Co, they have installed a new tenant, collected an enhanced figure for Ingoings considerably higher than their Valuers figure to the departing tenant, they have £45K + sitting in their bank, under no obligation to pay regardless of their letter saying payment at 28 days.

The Pub Co’s in their leases and tenancies give 7-14 days credit, or cash with order, they in turn, to be fair should be bound by the same credit agreement, lawyers will claim that this does not apply and they create their own rules for returning tenants funds.

If you buy a freehold or a free of tie lease everything is paid on changeover day, the purchase of the freehold or lease and the Ingoings, Fixtures and Fittings, Stock at Valuation, but you do have to use a solicitor.

The same should apply to a lease/tenancy assignment or changeover, it should be absolutely “Squeaky Clean”, which it is not and we are assured by our sources that the practice is widespread with tied leases and tenancies.

If you are a company that has never carried out this practice we would like to hear from you.

We have lodged a complaint with the Pub Governing Body on this highly questionable activity.

The Government a few years ago, said they were committed to stopping this financial abuse of small business people by large companies. The fines should be draconian, because the practice is widespread by these companies, knowing that the longer that they can keep the money in their accounts is a massive saving on bank charges.

In this case, if they have, say 20 changeovers a week, this could give them up to £900K of other peoples’ money sitting in their account.

We would love to name and shame the Pub Co involved, but until we know the tenant has received all their monies entirely, the sorry tale stops here.

If we want people to make a career for life out of the Industry, we need to clean up all these sharp practices.

Should you need an informed opinion, please email us at

Potboy West

The views expressed are not necessarily the editors and accepts no responsibility for them, we do try to avoid offensive or litigious statements being made. They are written by concerned professionals in the industry who feel that these issues should be raised to ensure that all licensees are made fully aware of many hidden pitfalls.

 Barrel-dregs 2




Who would you sell your business to?


Who would you sell your business to?

Imagine a scenario. You have decided to sell your business, and you were hoping to sell it for, let’s say, around £300,000. There are only two potential buyers. Which offer do you accept?

The first offer is from an individual. They are willing to match the asking price of £300,000. But they haven’t arranged their finances yet, so they need to now sort out a loan in order to complete the purchase.

The second offer is also from an individual, they are only offering £280,000, but already have proof from a financial institution that they have a loan in place, so they will just need to dot the Is and cross the Ts.

I’m not sure about you, but I’d definitely lend a lot of weight to the second offer. (Obviously, if there was a third offer of the full amount in cash up front, we would probably take that, but sometimes you don’t get dealt such a good hand!). Although the offer is for slightly less, just having proof of finances is already a reassurance that the deal is much more likely to go through, and at a much quicker speed too.

And you should adopt a similar attitude if you are looking to buy a business. Having proof of funds in advance of an offer can sometimes make the difference, and can put you in a stronger negotiating position to boot!

So if you are looking to buy a business, then it is worth speaking to ASC, a commercial finance broker with over 40 years’ experience. With our successful track record, we can arrange finance to buy a business, and for commercial finance, development finance, asset finance, working capital and more.

Read On

Government Revue of Business Rates, Latest News? (Barrel-Dregs 276)

Bad Beer For Export

The Chancellors review of Business Rates for small businesses. Fat Chance!

The initial flurry of excitement that the Chancellor was going to introduce some common sense into rates, has steadily fallen apart since his announcement, the informed sages in the industry were sceptical, putting it mildly, that the Inland Revenue Valuation Office could or would affect any changes to the advantage of any small business, unless it was a Charity Shop, extremely unlikely, read on.

The new rating regulations, which have the title ‘Non-Domestic Rating (Alteration of Lists and Appeal) (England) (Amendment) Regulations SI2015, number 4242’ will have been laid before Parliament and came into force on the 28th March 2015. The sting was that these new regulations now enforce significant limits as to how far you can backdate the effect of Business Rates proposals.

Although the subject is as dry as dust and more than a little boring to most licensees, you may recall that a proposal to amend or alter your rateable value, could be backdated to the 1st April 2010. In other words, if you did achieve a significant reduction in your rateable value and also with the rates payable, you could claim that back for five years, which sometimes meant a very substantial rebate.

The new regulations, published on the 28th March 2015, gave only three days – yes, 3 days! – for the lodgement of new proposals before the 1st April 2015, to take advantage of the five years’ backdating. After the 1st April 2015, you can only backdate to the 1st April 2015. The regulations are, however, slightly more benevolent if it is the Valuation Officer making the proposal to alter the Valuation List, so no surprise, the Draconian three day period of action does not apply to the Valuation Office Agency. Your SCORFA Rating Surveyor / Valuer should have been up to speed on the now imposed regulations!

Morgan  Clarke Logos copy

ALMR, Latest News (Energy Costs, Online Review Sites essential)

ALMR partnership to meet new business energy demands

The ALMR has partnered with Control Energy Costs to offer tailored advice to its members complying with the new Energy Savings Opportunity (ESOS) scheme.

ESOS is a mandatory scheme requiring businesses employing more than 250 members of staff to undertake periodic energy audits to identify energy saving opportunities. These audits will need to take place and be reported every four years. Any UK company that has annual turnover in excess of 50 million euro (£38,937,777) and an annual balance sheet in total excess of 43 million euro (£33,486,489) must also comply by 05 December 2015.

ALMR Chief Executive Kate Nicholls said: ““As we have seen with previous European legislation regarding allergen information, there can sometimes be mixed messages and there is a risk that operators may be overwhelmed by information. Businesses will need to undertake careful management and risk assessment at a very busy time of year and there is a risk of additional compliance costs. Our latest Benchmarking Survey found that licensed hospitality businesses are spending almost 4% of their annual turnover on utilities and that figure is now likely to rise.

“Using its position as the UK representative to HOTREC, the ALMR has worked to provide its members with the best possible advice and our partnership with CEC aims to ensure that the process runs as smoothly as possible and provides quantifiable results.

“Rather than being seen as a burden, we hope that licensed hospitality businesses look upon the ESOS scheme as an opportunity to grow their businesses and make considerable cost savings. Additionally, we are offering tailored advice in partnership with CEC, not a broker, so our members can be assured of practical, independent support.”

Accuracy and transparency for online review sites essential, says ALMR
Responding to the Competition and Markets Authority’s call for information regarding online reviews and endorsements, the ALMR has called for more to be done to protect both businesses and customers and regulate online markets.

The CMA has carried out a call for evidence into online review and endorsement websites.

ALMR Chief Executive Kate Nicholls said: “Online review and booking websites play a significant role in the marketing of hospitality businesses and their influence has grown over recent years. A recent study by the EU found that 54% of British consumers use comparison websites before booking hotels or restaurants and the prevalence of such sites is bound to have a knock-on effect across the whole hospitality sector. A recent survey among ALMR members revealed that over 85% of the sites operated by respondents were included on review websites; and a Trip Advisor survey carried out in 2013 suggested that 96% of operators saw reviews as being of the utmost importance in generating bookings.

“The increase in the use of this technology has the ability to empower customers and provides businesses with the potential to improve their offerings and connect with their customer-base. Unfortunately, a recent survey of our members suggested that problems relating to online review sites are occurring with increasing regularity for our members.

“Review websites have effectively become third party intermediaries for guests to communicate with pubs, bars and restaurants instead of engaging with the business themselves. As such, there need to be accurate measures in place to ensure that the information available to customers, and relating to businesses, is accurate and timely. Some of our members have reported difficulties engaging with review sites when inaccurate or malicious information has appeared. Erroneous information, be it deliberate or accidental, is of no use to customers looking to make an informed decision and can be actively damaging for operators.

“Current provisions to ensure fair use of review sites are inadequate and we have liaised with the CMA to request that they carry out an inquiry and establish a Code of Practice to set out ranking and listing criteria, authentication procedures, withdrawal of reviewer anonymity and a requirement to identify paid-for listings.”