This information is for guidance and to help overcome the many small and large hurdles that very few people ever tell you about that occur from day to day in the setting up and running a pub, it is not everything but a considerable number. The Common Sense Guide to Buying a Pub deals with preparing to buy, this covers some of the things that you need to know when you take possession.

 Cookseys DMP link to their web site  www.cookseysdmp.co.uk

General Information

• Firstly you become a key member of the community, like the owner of the village shop, post office etc., this can go to peoples heads. If they have never been self employed with initially a lot of available cash and even more fair weather friends, do not buy or give away loads of free drinks except on the opening night.
• You are every customers confessor, believe a fraction of what you here and keep well clear of controversy, they say never discuss, politics, sex or religion, it can cost you customers, it is very hard not to do this, but be careful, a chance comment will always be misconstrued.
• If you take over a good pub from a good licensee you may well have a hard act to follow, unless he has retired, it is impossible to run the pub the same way as your predecessor, so bring in gentle changes to suit your requirements, if it is a badly run pub implement change as soon as you understand how the place works, but you need to run it to find out the behind the scenes problems.
• Things to avoid, do not take over a week before a public holiday, you do not have enough experience and it will take you months to get back dissatisfied customers if at all, start carefully and do the things that you know well and expand gently.
• Never take over at the latter end of the month, takeover at the beginning of the month, this gives you roughly six weeks credit which in turn gives you six weeks takings in the bank and a lot more financial credibility in the Banks eyes, don’t spend it on a new car, these bills have to be paid at some stage.
• Look for a source of core business to underwrite your business, college, hospital, trading estate, RAF Station, tourist attractions etc., do not assume the locals will immediately pour into the pub, they can be very fickle.
• Make sure that you have provision for any unexpected tax demands, your tax is paid in advance, so until you have traded for a year you could be assessed and it will take a year for it to be repaid since one normally shows a tax loss for the first year with all the start up costs.
• You have to make a legal decision about staff, if you can last for a couple of days with friends, then re-employ the existing staff you want a few days later, make sure that you act totally within the law because of redundancy payments.
• If you can close at lunchtime do so, to give you breathing space, but make sure you put out notices to that effect. If you can close for two days it gives you a real chance to get everything sorted out.
• Pricing, check local prices before you take over, there are three things maintaining percentage profitability, local prices and demand pricing (tourist places tend to charge more in honey pot areas, high quality food commands a higher price if you have the demand, if you do not, price competitively and as demand increases bring in more expensive items with a higher profit factor, retain some of the original low priced items this tends to stop the complaints about becoming too expensive). Unfortunately a lot of semi successful caterers forget this and increase everything, always have slightly less seats than you need this creates demand and people then book up in advance.

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Changeover Day.

• The Stocktakers are normally in quite early.
• The kitchen may have looked clean to you when you saw it originally, but the chances are that it is filthy, if in doubt get prearranged Contract Cleaners in to degrease and clean everything, they have the equipment and should know what they are looking for. If you and your partner try to do it,  it will take weeks and a lot of strained relations.
• When you finally get round to opening, it is normally expected to provide free drinks for every freeloader in the district. Try and aim for takeover day to be Tuesday or a Wednesday, never on a Friday, by doing this it leaves you with a couple of week days to get anything that you have forgotten, also if any equipment goes seriously wrong the service people are theoretically working, getting them is another matter. Opening mid week tends to cut the freeloaders down.
• Ideally, provide a free finger buffet, which is easy to produce, a large proportion can be bought frozen, this gives you an opportunity to test your equipment and find out how the kitchen works in terms of your perceived ideas, without being under a time pressure, the delivery time to the bar or restaurant is essential, if you have a long run it could easily involve you in additional staff to compensate for the distance.
• Drinks, normally you give a free drink to everyone that comes in, after that they pay, if you really want to make it into a party give them champagne cocktails, a knob of sugar, splash of angostura bitters, third of a measure of low priced brandy and sparkling wine. Set the glasses up with the sugar, angostura and brandy, then pour the sparkling wine as they come in, this will sort any hardened freeloader out very quickly and your real customers are usually impressed, you can budget for exactly how much you are going to spend, and the bottles of sparkling wine that you do not give away will sell another day. Giving a free drink to every customer in a busy pub can be very costly, because it becomes a game by some of them to see how many they can get.
• Champagne cocktails have an immediate effect on the average beer drinker, which five pints will not.
• All the people that come in first will tell you that they are your real locals, in reality your regular customers come in later unless you have an early evening business or over the next week, you will be surprised how few of the opening night people are serious regulars, they usually come from a nearby pub, rush back again to their local with tales of the new landlord, that which they don’t know they make up.
• Try to identify your market, you need a core business, your views on your target market may well change after a year, so be flexible.
• Some of the larger companies will run three trial nights with different groups of people to iron out teething problems and train staff before opening a new pub.
• Always talk to your staff and helpers after any busy night to identify ways of improving the operation, some of the best ideas come from your staff, you are desperately trying to do everything they are not under the same pressure and can observe as they go round.
• Always delegate where possible and let your good staff make decisions, this way they will become more responsible and make your life easier, if they make a bad decision and inform you rather than cover it up, be sympathetic and advise them how to make good, they are unlikely to make the same mistake again and learn more from these mistakes, rather than someone who appears to get it right every time.
• On opening a restaurant never take bookings on all the tables, have a few with reserved on and leave some gaps on your booking sheets, this gives you a safety factor if your operation is running behind time, if you are up to speed and some casuals come in you can claim the people did not turn up and give them one of the tables, the chances are that if they are delighted they will be good customers because you appeared to look after them.

Changeover Day Cash etc

• The gaming machines and other equipment need topping up with money, which can cost several hundreds, try to get away with the absolute minimum.
• Depending on the volume of business with the gaming machines as to whether you buy or rent, always buy a pool table if you can, second hand are not expensive and they can be recovered, the return in relation to the cost is normally far better than renting.
• You need change for the tills plus a back up float of change, again several hundreds of pounds, you may need to install a safe as part of your insurance policy, otherwise you can only be covered for a minimal amount of money on the premises.
• If you have a need for it a cash dispenser can prove very profitable in the right places.
• All the pipes may well need cleaning and the optics need checking especially ones with a high sugar content.
• All the prices need checking with the stocktaker if available.
• All the equipment needs checking to see if it works, you need an electrical testing screwdriver, fuses, fuse wire, spanners, bulbs and a tame electrician.
• Cleaning materials, glass and dish washer, dish cloths, drying cloths, new oil for the deep fryers.
• There will be deliveries of wet,  dry and frozen stock.
• You need to register with a Cash & Carry if you have one nearby or use a Supermarket until you are well aware of your needs, they can be cheaper than the Cash & Carry on smaller quantities.
• Ensure that you set up trading accounts with all the companies that you intend dealing with, trade accounts can take up to two or three weeks to put in place, if you don’t it will play hell with your cash flow.
• Always have two bank accounts, two butchers, two bakers, two greengrocers etc. if you have greengrocery delivered watch the quality, it always tails off quality wise once they have your business, if you can find a good fruit and veg wholesaler you can save yourself  a lot of money by collecting it yourself and also do some deals on interesting stock that they can’t sell.
• Check the tills and make sure you know how to programme them or understand them, do not let the vendor leave until you know exactly how they work, hopefully you may have spent a week with the outgoing landlord, unfortunately there are a lot who will not let you near the bars or kitchens until completion, they need close scrutiny, I have had several and they were trying to hide a lot of suspect things. Make sure your staff know how to use the tills but not the finer points of them until you are sure of their honesty.
• If you have a good friend with a car to spend a day getting all the things you have forgotten.
• You need to put the name of the Premises Supervisor ideally over the main door.
• A substantial price list displayed, a good idea is to put all the statutory notices and pricelist on the computer on one page, so that it can be amended when needed, then get several copies laminated with plastic and displayed at various points. Loads of tacky signs everywhere looks dreadful, sign re underage drinkers.
• You have to decide what size optics you are using in respect of gin, whisky, vodka and rum, wine glass measures, and display a notice, hence the computer notice.

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Accountants

• You need an Accountant who specifically deals with the licensed industry, find one that picks up the paperwork every fortnight or month, does your PAYE and VAT and charges you monthly, the prices can vary widely. You need a regular breakdown of you profitability and unnecessary overheads with predictions etc to ensure you steer the business in the right direction. Do not try and do the in depth paperwork yourself unless you are an accountant, your time is too limited and valuable running the business. If you do all the paperwork yourself and take it to the accountant once a year, you have six months of questions and agro until the accounts are prepared and I have normally been charged 50% higher than by doing it monthly, so your time is wasted. In addition on a VAT investigation they take considerably longer with an individual, with an accountant there they waste no time, my last VAT investigation took three and a half days sitting in my restaurant, with the accountant a day, they are paid to look for mistakes, accidental or deliberate. In this day and age ensure that everything goes through the books, the higher the turnover the greater the price when you decide to sell.
• You need your Accountant to advise on Stakeholder pensions and register for VAT as soon as you are committed to a purchase.
• Ensure that your Accountant advises you of all the forms that staff have to complete before they commence work, a signature on a petty cash voucher could cost you a fortune. All staff should have employment contracts, part time or full time, it could save you a fortune in a tribunal.
• You need employment contracts that relate to your specific business.
• Avoid taking on any long term staff because you are liable for their redundancy payments or ensure that there is financial provision made to cover this by the vendor and done through your solicitor.

A word of advice, I have for years accepted my Accountants advice to keep my wife’s drawings below the tax and NI level. This has now proved to be a costly error my present Accountant advised paying my wife sufficient to make an NI contribution and gain a credit, this then entitles her to a full state pension, make sure you ask your Accountant to look into this.

Advertising

• Advertising in the local press is expensive and often a waste of time unless there is some good editorial with it, free editorial written by the food or pub editor is by far the best, if it is written by you be extremely careful.
• Directional mail shots can be very beneficial using the local press. They can direct mail to specific areas and by spreading the shots over a period of time you can identify the success or failure rate and it will cost you considerably less than direct advertising. Do not mail shot the whole local area, if you have a massive response, you may not be able to cope and it will take you months to get the unimpressed back.
• 85. Ideally set up a postcard with a picture of the pub. On the reverse a small map and details of your fare etc, offering 10-20% discount if they return with the card, you can then monitor the response, a large number leave the card behind when they visit.
• Using the same card with a different format on the reverse, a small map but a normal address section on one half, the other half with a recommendation from a satisfied customer, any customer that expresses satisfaction give them a card to address it to a friend and fill it in giving them a discount, offering a similar discount at the bottom of the card, you mail it, it also helps build up record of customers.
• Sign posting, this is vitally important, tourist board signs are now available depending on the County Council’s view, they are not cheap but worth the money if you are not immediately visible or off the beaten track.
• Good artistic signing inside and outside of the pub are essential, it is very easy these days with liquid chalk.

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Banking

• Banks may give you between one and two years free banking on a new venture, this regrettably lulls you into a false sense of security regarding charges.
• They charge for every transaction, some every meeting, every letter etc., you do not realise this until your free banking has finished. Some people switch banks and get more free banking, changing an overdraft when you are trying to build up a business is not easy and selling the idea to a bank you may have approached before is even harder.
• Always have two banks one for business and a second private or a different business account in your name, you may well have a private account with the business account bank. Always keep the second banks account in reasonable credit with an overdraft facility in place, this gives you financial credibility in a second bank, who will always talk to you because you appear to be a good careful customer.
• Set up a deposit or Giro account for all your bankings, there is normally no charge for depositing to a deposit or Giro account, when you are off free banking you are charged for counting and depositing money, transfer any money needed for bills once a week or fortnight to your current account. Pay cash when ever possible, writing cheques cost money. Banks charge for change, if you get under a hundred pounds most banks do not charge, but you need to check this out.
• You will need a swipe card or PDQ machine, if you are running a food based or accommodation business. Most banks will try and charge you between 1.80 to 2.25% as a new customer, if you join the British Institute of Innkeeping, which you will be entitled to having done the NLC, you will be eligible for 1.15 to 1.35%. Whilst you are on free banking the hidden costs of a PDQ machine are not obvious, your current account charges you one deposit a day for the daily reconciliation to the account at roughly 40-45p a time, unless you have made another arrangement (£140 per annum), pay it into a deposit or Giro account it costs nothing. The money also sits in the card companies account for about three days. Do not pay for any installation charges, some banks charge up to £150 for setting up the system, shop around, you do not have to have a credit card or PDQ machine with the same bank that you are using for banking.
• If you have a healthy trading surplus, it is always worth considering buying small blocks of Premium Bonds whilst interest rates are low, the wins are tax free and the money is readily accessible when you need it.
• Banks do not have a love affair with licensees, unless you are successful or have a large piece of substantially un mortgaged property, you may find the majority of bank managers do not share your enthusiasm for the pub industry, if you can float a substantial amount of money without spending it, it does impress your manager. Pay the large companies on the final due date and the small local suppliers on time, the latter will always use your pub from time to time, the large companies you will very rarely do any business with.
• Try and have enough money in reserve for negative trading for six months, do not buy a load of new equipment etc until you are actually sure you need it, buy second hand with a guarantee until you are certain, you can always part exchange the old equipment or sell it in an auction.

Beers etc

• Draught Wine there are various systems, if you have a pumped, gas system ensure that you have a cellar buoy on the line, you can waste a vast amount on changing boxes.
• Real Ale can be very fickle if you do not have any finings if a barrel won’t settle half a bottle of lemonade poured into the spile hole at the top of the barrel may well sort it out.
• Identify your market, and vary the beer of the week.
• Try and keep a spare clean beer line and use it whenever a new barrel goes on.
• If you are throwing more than forty pints of beer away on cleaning, look at a mechanical cleaning system, they are not cheap but they can save you time and money. Be careful with magnets and electrical systems to keep the yeast in suspension unless you have high volume beer sales.
• Most Brewers will happily run you through a course on cellar management, it is very much in their interests for  your beer to be in top condition.

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Business Details

• If you are able to ask for the weekly turnover figures for the last year, put them into a graph, indicating all public holidays etc. and check the flow pattern to identify high and low points of trading, you can then make a rough comparison to the last audited accounts.
• A rough guide to profitability 10% Net at £150,000 turnover with a mixed business (wet & food), below that the net figure decreases steadily, above that the figure increases, there are various points where your staff costs ratio can throw this figure out and you need to identify the increase in your turnover to get the max profit out of your operation.
• Your staff costs can increase dramatically in a food based operation because your pub eating area and kitchen layout are not sympathetic to your operation, you are invariably dealing with a property which has evolved and been expanded over the years without too much serious thought to the practicalities of an ever changing trade.
• A good quality hot or cold carvery is the most staff efficient and friendly, silver service the most costly.
• The most cost effective operation is a purely wet trade, the overall profitability is less usually 47% GP,  you need less staff. A food based operation is normally about 50% GP upwards, a quality food operation can be as high as 60% GP but your staff costs will be much higher.
• Snacks have a high GP and a low cost and can be very labour intensive, they can be very profitable since there is less skill involved in their production.
• Restaurant food also has a high GP with a high cost giving a far greater turnover and very high labour costs (Chefs waitresses etc)
• Having a restaurant menu and snack menu can be totally exhausting unless you have a secondary team and facilities for snacks in busy pubs.
• If you are fortunate enough to have letting accommodation, use it to the full, it raises your GP and can well underwrite the business, make sure that all the furnishings and en suites are spotless good letting can command a premium always set up a self service breakfast with ordered hot dishes, this cuts down your staff.

Demographics of the Business

• A large number of Freehouses are suffering with the change of business to the town centres, a lot of careful research is needed into the current business ignore the trading accounts two years before, because the demographic age of people using town centre pubs has risen from 18-35 to 18-42 year olds. This leaves the older population as your core business and they can be very fickle and careful with their expenditure.

Employment Law

• Employment Law is an ever changing minefield, if you are a member of the BII there is a free legal helpline to give you advice on this and an employment package for under £100, you may well have access to a helpline through your insurance policy. There are specialist solicitors who are worth keeping in contact with, especially when you are new to a business and dealing with unknown staff, if your own solicitor has a specialist on his staff make sure that they do the employments contracts or conditions of employment. Never make a hasty decision without checking on the helpline if you have one.
• The BII have a course specifically for staff, to make them aware of their responsibilities in respect of the Licensing Laws, they provide a book which is an abridged version of the manual for the essential Licensing Qualification (NCPLH). The book costs about £5.00 from the BII it is well worth buying one and keeping it available for the staff to refer to on any issue, also get every member of the staff to read it and sign a statement saying that they understand it, it comes under due diligence. It will not remove your responsility, but it ensures that your staff have been made aware of their responsibilities and go in your favour should an error occur.

Equipment

• Do not buy high tec video machines, they always go wrong, either rent or have split deal with the owner, he effectively rents the space from you. Pool tables see previous comments.
• The majority of bar equipment is supplied by drinks companies with a service back up, some companies are extremely slow, avoid them once they have been identified, unfortunately the standard of service varies across the country from firm to firm.
• Glass washers, these will build up black slime over a relatively short period of time and you will find hard black flecks sticking to your glasses, they need regular checking, dismantling and checking in the spray jets and the main tank. Beer line cleaner is reputed to help clear this, so a regular rinse at the end of a week is worth doing and a thorough clean every two or three weeks depending on your local water.
• Ice Machines, be careful where you set these up, some will stop working if set up in very cold conditions i.e. a badly insulated beer store in Winter. A regular fault with some ice machines are the heated ice cutting wires breaking, it is possible to resolder them if desperate, otherwise it costs quite a lot of money to repair, if you have freezer space it always worth storing bags of ice for breakdowns.
• Cellar cooling make sure that your beer cellar is insulated and your refrigeration is only cooling the area that you require, close off any areas in the cellar by insulated stud partitions or a heavy plastic curtain, avoid having electrical equipment generating heat (Freezers etc) in the area to be cooled, your refrigeration costs will increase dramatically.
• It is now acceptable by the EHO to store various food stuffs in the refrigerated cellar, mainly fruit and veg, strawberries, onions, garlic and mushrooms are reputed to affect real ale, in a well cooled cellar this is questionable.
• It can be worth looking at a heat exchanger linked to your hot water system where you have a large number of appliances in a room.
• Combi Ovens are excellent but very expensive and require a lot of space, be wary of second hand ones, make sure the have not been run into the ground, they cost a fortune to repair as with some commercial microwaves.
• If you can have two food processors, two mixers etc, avoid buying ones with a lot of gimmicks unless you know you are going to use them, Kenwood Chefs can always be bought from the local paper at sensible prices, they last for years.
• If you are fortunate enough to buy a steamer, the smaller ones are about the size of a large commercial microwave, they remove all the hassle of big pans boiling for hours on the cookers, vegetables take two to three minutes and potatoes eight minutes.
• Until you are sure of what you need and you can afford it, a cheap solution provided that you have a couple of ovens and two or three 750-800 watt microwaves not necessarily commercial ones, if they are back venting they will stand one on top of the other, to bring a pie or hot dish up to temperature in the microwave it will take two minutes and eight minutes in the oven with a pastry lid on and you have a made to measure pie, it will take you sixteen to twenty in the oven without the microwave, you could find as we did that we had a greater capacity than a combi in the end.
• Gas is by far the cheaper method for cooking.
• If you are equiping a kitchen and you cannot afford stainless steel, using domestic units without doors can save you a large amount of money, all you shelves are visible and easy to clean. Normal kitchen work tops are relatively cheap and can be replaced every couple of years if you do this. Stainless units can be bought second hand or at auctions, they are expensive new and even more so if tailor made. If possible when using stainless have wheels on everything you can then move and clean or rearrange your kitchen as you see fit.
• Dishwashers, with most of these the crockery needs rinsing before washing, most dishwashers act like sterilisers, the bulk of the water is recycled and the filters get very dirty and need cleaning after every session, unlike a domestic dishwasher which has frequent changes of water, it comes as a shock to the housewife turned publican, the larger machines work on a different system, but they cost a lot more money. A good dishwasher can save you at least one member of staff if used effectively.
• Hot cupboards are worth investing in, it represents another work top, a constant source of hot plates and storage, it also leaves your ovens free for cooking. If you inherit an unlined one, line it with foil covered plasterboard, it will save you a load of expense.

Alliance Online Catering Equipment – suppliers of Pub and Bar Equipment to the UK trade.

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Fire Risk Legislation and Information

In 2005 the legislation for fire safety changed. Having a fire certificate on a business premises is now no longer sufficient. All non-domestic properties (including pubs, restaurants and hotels) are required, by law, to have the following:

• A suitable & sufficient fire risk assessment for the workplace, carried out by a competent person
• Identified fire safety hazards and an action plan for managing and dealing with those hazards.
• Appropriate fire-fighting equipment including fire detectors and alarms.
• ALL staff fire awareness trained and certain staff members trained as Fire Wardens.
• Information regarding the above to be made available to all employees.

 Quite often publicans will put off sorting their fire safety. It’s easy to forget, when you’re running a busy pub, until you have a visit from the fire officer. It is so important to get it sorted early on, as leaving it can result in prosecution by the fire brigade or a fine.  In June 2008, the owner of the Brandon House Hotel was fined £204,000 for failing to ensure that his hotel met vital fire safety standards.

 When choosing a fire safety company, it is always worth shopping around. Ask friends, colleagues or an independent association if they can recommend a company. Try to get quotes from a few companies if you can, both local and national, for ALL aspects of the legislation. It’s no good getting a great deal on your extinguishers if the training is going to cost you double!

Do your research – how many extinguishers, and of which type, do you actually need? Is a massively expensive alarm system necessary?  So many companies, even reputable ones, will sell you much more than the requirement on extinguishers, alarms and emergency lights and then charge you again every year to service them!

One example of this was a small grade II listed pub in Bath who were advised that they needed to fit an expensive fire alarm throughout the building, incurring huge expense. After doing some research they were advised that they in fact didn’t need a fire alarm as the property was only small, and nobody ever slept there. As long as all members of staff knew how to raise the alarm (to ring the last orders bell) then an automatic alarm was not necessary. This saved them over £4000 installation and over £150 every year for alarm servicing.

The BII recommends the Smartlog system from Safesmart. Smartlog from Safesmart is an online fire safety system that allows you to train all members of staff in both fire awareness and as fire wardens, carry out a full and complete risk assessment, and acts as an automated log book to remind you when any compliance issues arise. The Smartlog system is specifically designed to be easy and simple to use, and does not require any prior knowledge of fire legislation or advanced IT skills. As well as the Smartlog system, Safesmart aim to significantly cut your extinguisher, alarm and emergency lighting costs.

To find out how Safesmart and the Smartlog system can reduce your costs, as well as ease compliance, call on 01908 261403, send an email to dean@safesmart.co.uk or visit the website at www.safesmart.co.uk

General Business

• If you have a good local charity like Childrens Hospice, RNLI always run  charity functions from time to time it is good for them and good for you.
• These can be a boon or a pain depending on your business, you can have a teams playing for you, who play under a flag of convenience, they do not use your pub, drink very little and expect free food on the nights that they are playing at home, some start to try and control the pub, you need to be diplomatically firm and sort the wheat from the chaff. You can have a lot of fun with teams and they can serve as your core business.
• Drugs, these can be and are a very serious problem, there are courses and literature available. If you suspect a problem, spray all the flat surfaces in the toilets with WD 40 ruins any drug that is placed on the surface, vaseline does the same makes them unuseable, some places have to remove the toilet seats. In one pub in North Cornwall, the dealers were putting drugs in between the leaflets in the tourist information box as a collection point, one even put the drugs under the beer cloth on the bar to be collected by his addict as he bought a drink, contact the police for help if you suspect a problem. Some of the serious users and dealers are not scruffy addicts but wealthy customers.
• Taking food and drinks orders together at the bar in a busy pub can take three to four times as long, having a separate place or person to order food speeds the whole process, the barperson can serve three times as many people. The human element creeps in with joint orders, the person ordering frequently forgets some ones order and has to refer back or something is not as they thought it was, delaying the staff time, how many times have you been waiting to be served and the person in front is dithering over the food order, whereas with just drinks it is all done in minutes.
• Run the pub as a business not as an extension to your private life, make it look like that, avoid social drinking in the morning or early evening it’s a long day.
• My pet hate are barmen putting the dispenser head in the beer when pouring, the head is seldom cleaned until the end of the day, flies will always head for it and landlords dogs have been seen to be licking them, animals are not allowed behind the bar????
• Swan Necks which are supposed to be immersed in the glass for better presentation, they frequently syphon out the beer and collectively add up to a lot of wasted beer, more profit for the brewers???? Sadly it is the way beer heads have gone these days.
• Always have disposable paper towels in a dispenser beside the hand washing facilities, have a hand towel close by as well, if the hand towel is removed the EHO always appears at that moment causing an embarrassing lot of excuses.
• Coaches can be a complete pain dozens of people emerging none of them spending any money and wanting to use the toilets, coaches by appointment for pre arranged meals or accommodation etc can be excellent.
• Locums, there are specialist companies supplying locums if you wish to have a holiday, they are not cheap, they will not always run the business the way that you do, but they provide freedom if you wish to go down that road, make sure they are bonded. If you can get your staff to cope and they do it is added responsibility for them and good for you.
• There are terrific regional variations in staff, from skill, intelligence and availability. It may be a super pub but without staff it’s a disaster.

Kitchen

• Whatever you cook make sure that it will cope with a certain degree of standing time or kitchen abuse, because the customer is not ready or the staff are struggling, in some cases replate it, there is nothing worse than a meal that has been sitting in a hot cupboard, it looks dried up and the sauce has formed a line on the plate an immediate give away.
• Initially cook the things that you know how to prepare, find out how the kitchen works, it may take you two or three rearrangements before you get it right. Do not be inhibited in trying anything, test it on the staff and when you try it on the customers, always say that they will not be charged if they don’t like it, just in case you have omitted something.
• Garlic butter, avoid using garlic salt, use fresh garlic and do not make it too strong, mild garlic butter gives a wonderful flavour to anything that you are pan frying or cooking, a bowl of melted garlic butter with a brush to brush the vegetables and potatoes, even chips, it also gives them a glaze, finally a sprinkling of chopped parsley. Always use a squeeze of lemon and some ground pepper when you make the garlic butter.
• Pan fried steaks are the nicest, finally dice some onions and mushrooms and pan fry them with some garlic butter and vegetable oil to get a good flavour in the pan, dust your steaks with some Knorr Arrowmat and black pepper and pan fry to order, they taste superb.
• Beware of pink sticky steaks they are too fresh, they need to be a dark maroon colour.
• As a rough guide, when the pan is hot and a normal rump steak, one minute either side for a rare steak, two mins  either side for medium rare, three mins either side for medium, well done throw away the timer, always check to see they want it incinerated, it’s a waste of good steak.
• If you have the misfortune to have to do a blue steak, refuse to use rump, rump can be very chewy, only use fillet. The steak has to be put into a very hot pan blasting either side, unfortunately the inside is totally raw and can be cold with thick steaks, I have always put the steak into the microwave until it starts to change colour slightly, then put it into the very hot pan, the steak is then hot all the way through.
• Always make sure all your knives are razor sharp, blunt knives can cause minor chaos when you are busy, if a knife is no longer useful get rid of it, get a good sharpening steel and get your local butcher to show you how to use it.
• Air conditioning based on cellar cooling is being installed in many kitchens, since they become sweat shops in the heat of Summer.
• Crockery, it is far easier to use white china, then you have no problem matching it, if you have patterned it can cost you a lot of money on replacements especially if it is discontinued.
• It is worth going to Royal Worcester from time to time and visit their white china or 2^nd 2nds department, they have some fantastic bargains in porcelain and last for years, avoid the normal 2nds department it is too expensive for commercial use. Sadly I have just found out that Royal Worcester has now closed for their incredible 2nds and Spode their sister company has been taken over by Portmerion, it is worth a call to see whether they are continuing with their 2nds sales, be assured that if we find that they are resuming we will make all the details available. The 2nds or factory shops are terrific value for the commercial caterer.  
• Always drive up to Stoke on Trent and tour the 2nds shops in the factories, they are well worth the trip for catering use and pub decoration.
• You need a First Aid Box in the kitchen and possibly a second one behind the bar depending on the pub layout. An accident book in each, this only needs to be an exercise or note book, if you have a purpose made one, even better.
• If anyone takes a plaster out for a fresh cut, ensure that they put an entry in the accident book however slight it may be. We are a soft target for no win no fee solicitors and we need to prove that we are duly diligent, by having an accident book full of minor and major incidents that is a start.
• Keep a diary behind the bar of any incident that would not go in an accident book, if you ask someone to leave, see them right off the premises and put a note time and date no injury, likewise with any other near risk incident, time and date no injury, it is then up to the claimant to prove that you are not duly diligent and that they were in fact on your premises.

Insurance

• Most leasing companies insist that you insure through them. Unfortunately you often find that you are paying a standard rate, regardless of the Insurance Risk Factor, the trouble free country pubs pay the same rate as the troublesome town centre pubs in high risk areas and there is nothing that you can do if it is in the lease. If it is not in the lease shop around for the best deal not necessarily the cheapest deal, ensuring that you have adequate cover for replacements for key staff in respect of injury on or off the premises, this is not essential but advisable. Contact kenny.robinson@bateman-group.co.uk , www.thebatemangroup.co.uk they are competitive, they also refund your annual subscription to the BII if you have a business policy with them

Legal and licensing responsibilities

• You have a substantial legal responsibility which is explained when you do the National Certificate for Personal Licence Holders and Food Hygiene Course (Some areas insist you do this every 3 years), these do not tell you how to run a pub but bring you up to date with current legislation.
• Ensure that the Premises Supervisor is registered with the Licensing Authority, also all Personal Licence Holders have registered their changes of address with the Authority that they were first registered with, if they haven’t they can be in trouble with the Local Authority.
• You have a serious responsibility in employing staff in respect of their welfare at work and occasionally at home.
• You are also a full time accountant, chef, barman, tax collector, saint and sinner.
• You need permits and licenses for gaming machines from the Local Authority.

Operating Schedule and PRS and PPL Licences

• You will have an existing Operating Schedule, ensure that it suits your intended operation and that you can comply with the existing schedule.
• Make sure that you are cleared for all the extensions for public holidays through the year. You may think you can open and close when you like, but you can’t, the Operating Schedule details your hours and may not include Public Holidays etc.
• If you have any sort of music being played from radio to juke box you need a Performing Rights Licence, they will charge you extra if they find you playing music without a licence, ring them as soon as you exchange contracts, also ensure that you only pay for the areas where music is played, the smaller the area the less you pay, there is a minimum amount. PPL if you rent a music system it is normally paid by the music system supplying company, regrettably you need both these licenses.
• It is now more advantageous to have two or more people with a personal licence to convince the police and licensing authorities that one or other of the licensees will be on the premises, it is not essential, but should a mishap occur to one, there is no need to go to court to get another licensee approved.

Phone Calls

• You will be besieged by phone calls by dozens of organizations a few will be genuine a large amount suspect.Trying to get you to advertise in magazines, guide books, sporting events, charity functions, support only ones you know or local charities. If you are vaguely persuaded, dial ring back on you phone and you will always find the number withheld or ask for their number to check with trading standards, the phone is immediately replaced. Unfortunately the unsuspecting are a soft target for a lot of plausible professionals who make it very difficult for genuine charities.There are the ones purporting to be promoting some police or fire service boxing promotion or regional guide book, selling advertising space, if your local police come round it may be worth considering. There are groups of people who are making a fortune out of new scams every month at the expense of unwary.

Qualifications.

• You need to do the National Certificate for Personal Licence Holders which is set by the (BII) British Institute of Innkeeping. This is the minimum qualification to hold a licence to satisfy the Police and Licensing Authorities. It brings you up to date with current licensing law it doe not teach you how to run a pub or licensed establishment, if you leave anyone in charge on a regular basis worth considering putting them through the NLC. The price varies between £80 to £170 depending on Government subsidies, shop around for the best or most convenient deal, if you need to do it urgently and not on a prescribed course it may well cost you £150+ each. If you are in the Swindon Area they will insist that you do their drugs course as well.
• Food and Hygiene this course is done by most technical colleges and the price varies from £15 – £90 you may well need to put all you semi permanent staff through it depending on the EHO, this course is not run by the BII but by the EHO.
• The BII sets all the other qualifications in the pub industry, and has accredited trainers all over the country, they set the cost of the qualifications but not the cost of training, so shop around for the best deal.
• The Licensed Retailing Exam is a three  to five day course including the NLC, these courses give you an introduction to running a pub, covering all the basics from pub administration to cellar management.
• The Advance Qualifications cover a wide range of subjects at greater depth, see appendix
• If you have an entertainment licence you may well have to do the Door Safe Certificate, make sure that the course that you do is approved by the area that you are in, some local authorities insist on doing their own and others are not acceptable, ensure that your door staff have the correct qualification, unfortunately it can be very costly if you get it wrong.
• There are various courses run by the BII the latest being the Responsible Alcohol Retailing where the training is done in house, this is designed for staff and the manual costs about £5 from the BII is always worth having on the premises for staff to be aware of their legal responsibilities.

Regulations

• You need to check the Fire Regulations with the Fire Officer as to how many people you can accommodate and what sort of safety appliances etc are needed.
• HARM Hazard Analysis and Risk Management plus Health and Safety, Accident Books and Procedures, First Aid Boxes.
• Fire Equipment it pays to have an annual contract, shop around for the best deal.
• EHO and HARM, contact the local environmental health and get them to inspect the premises before you start or shortly afterwards, their views and ideas vary widely across the country. They may insist that you do a full Hazard Analysis Risk Management across the whole premises where you may need considerable assistance most only apply it to the kitchen.

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Scams

• Massaged figures, very unscrupulous individuals can greatly enhance the value of a freehouse by feeding additional cash through the till, in certain instances hot money, under the guise of accommodation or high prices for food, the tax and VAT is paid on the increased turnover and profit but the value of the property can be enhanced by one and a half times the annual amount passed through the till.

Smoking

• Use a cigarette vending machine it saves pilfering and does not affect your gross profitability percentage, the company will pay you commission, the same with condoms etc in the toilets and any other dispensers.
• Ensure there are notices re underage smokers obtaining cigarettes.
• A useful sign in the toilets is “Please do not smoke in these toilets it sets the security alarm off” I only had one cigarette end in the urinal in six months and none in the ladies. Smoking is banned everywhere, but there are certain people that assume the Toilets do not count.
• You may have to construct a Smoking Shelter, which require in a number of cases planning approval, it is not a structure than can just be erected without professional advice.

Solicitors

• If you are buying a lease or tenancy ensure that you use a solicitor used to dealing with pub leases and licensing, your average solicitor may miss something, it has become very specialist.
• A Licensing Consultant is often cheaper than a solicitor for licensing matters and in a lot of cases a more ready knowledge of licensing law, some are ex licensing police officers and know their way around the local courts and their particular requirements.
• You need an exclusion zone in respect of your vendor, otherwise he can set up business nearly next door and take all the trade.

Staff

• If you can, always find a cleaner, the best response to an advert is for a Mature Treasure, this leaves you time to get organised. Avoid the so called professionals that have worked everywhere unless you have a good stock control system, you may be lucky, be careful. It could be classed as politically incorrect, but mature could apply to anyone over sixteen years of age.
• Young attractive girls are good for business but a disaster when they fall in love with a married customer.
• The best are part time thirty plus housewives with an interest in food, try to get them interested in all aspects of the business from bar to kitchen. Involve them in preparation. Cooking, waiting etc. and ensure that anything that is not up to scratch never leaves the kitchen whoever prepared it, this maintains an across the board standard and everyone works as a team.
• A useful phrase “People do not come here to just eat or drink they come here to be entertained” make every one feel special, unzip a smile when you enter the bar or leave the kitchen, do not argue with customers let the boss sought it out, if there is a goof up change it immediately. It takes longer to get a regular customer than lose one through a mistake or bad service.
• Chefs are notoriously temperamental, make sure that you know as much if not more than he does, if he does something that you do not know how to cook, make sure you find out how to. The first time that the Chef walks out you need to be able to continue without appearing to affect the business. Your Wife may be a good cook but make sure you are equally capable.
• Ensure that you have a smoking, drinks and tips policy regarding staff.

Stocktaker

• You need a recommended stocktaker for your takeover day, they usually suggest that you split the cost with the vendor and use the same one, if the stock has been run down to a minimum, this can be convenient. If you have a large Stock at Valuation use your own stocktaker and ensure any near date or out of date stock is not accepted or stock that you could not be reasonably expected to sell, you could find two cases of some obscure rye whisky, because the landlord drank it and you have no possible chance of selling it. A good stocktaker is well used to indentifying fiddles re stock and stock deficiencies and will advise you of the various obvious and less obvious scams.
• To run an efficient accounting system you will need a stocktakers services on a regular or annual basis, he may well give you a regular profitability break down since he is constantly in touch with local prices, which until you find your feet you will not have the time to do.
• Use a stocktaker as your accountant suggests, if you have a busy pub with a large number of staff, very regularly, if it is just two of you every three months.
• Do not help yourself to drinks regardless, book it all down, if you are seen to help yourself, the staff may follow suit because the professionals know that an accurate record is not being kept and the system will stand abuse.
• Always check the barperson who leaves the till open, they can avoid ringing up or they can under ring and extract the cash later.
• Watch for the barmaid with an adoring boy friend sitting at the end of the bar, she may supply him with regular drinks. It’s bad for business, she spends more time talking to him than looking after the customers, either way it costs money.
• If you have a serious stock problem, do a weekly stocktake and put discreet security cameras in watching the tills and vulnerable stock, loose packs of cigarettes are one of  the worst problem, remove this by using a vending machine.
• Buy sensibly, think before you get an apparent good bulk deal, you could end up with a lot of stock sitting in your store for a long time. Look for the deals avoid carrying a large stock, steer your customers towards the advantageous buys that increase your GP with promotions.
• It is not necessary to carry a large stock of spirits and wines, unless you have a very lucrative restaurant business, spirits and wines can be bought more cheaply on most occasions from Cash & Carry’s or Supermarkets than from the majority of delivered suppliers, unless they have a promotion on. There is the serious risk of a robbery if it becomes known that you carry a large stock, especially prior to Christmas.
• If you can afford it install an EPOS (Electronic point of sale) type till system linked to your computer, this if run properly will give you daily details of your theoretical stock sales and levels, unfortunately a stock check is required regularly to reconcile the actual value or deficiencies, it is an early warning against suspect staff.
• If you have a busy machine pub and you are tied by your lease, rent the machines with a regular change over, if you have a low machine income and you can afford it buy a second hand machine with a guarantee and a tame mechanic, then all the income is yours.

Television in the Bar

• Be very careful about the cost of putting some TV systems in for customer viewing, make sure that you are well aware of the costs and restrictions. Sky are always chasing licensees for supposedly using European TV for sport, make sure you are legal.

Water and sewerage, Power etc

• Toilets make sure you control the water usage, your water bills can go through the roof with a continual flushing system, there are a whole range of elementary and complex systems.
• If you use water for irrigating window boxes and extract any waste water by putting it into water butts for other uses, you can claim a reduction in water rates if you are on main drainage, because the water is not going for sewerage treatment, sewerage charges represents about 52% of your water bill.
• Electricity, these bills are normally enormous by comparison to domestic property. The local supplier will advise you on the most advantageous rates commercially. Use low wattage bulbs everywhere, there are normally fifty plus bulbs in the average pub and they are on for about twelve hours a day, using 40 and 60 watt, that represents 30 khw a day, using 15 watt long life it represents about 9khw, which is a substantial saving over the year. In addition low wattage bulbs whether long life or ordinary do not get so hot and last far longer, conventional bulbs have a very short life in terms of pub usage. Using microwaves to raise food temperatures in the kitchen rather than electric rings, if you think about the practical aspects you can save a lot of expensive electricity.
• Central heating, storage heaters in a pub are uncontrollable and expensive. Gas or oil fired heating used sensibly can be very economic. If you can have thermostats and automatic valves in all the various bar and restaurant areas and your private accommodation. The reason being that any area not in use can be isolated, if a bar area is busy the heating in that area will switch off since a lot of people generate heat and then cut back in when needed. Your private accommodation requires heat when you are there you can even instal a separate time clock for both business and domestic. Unfortunately most central heating systems are set up with one thermostat in the middle of the bar and as soon as it gets busy shuts the whole system down or heats up all the vacant areas, by isolating and controlling areas it reduces your bills substantially and the boiler is not working at full pressure all the time, in fact you can get away with a much smaller boiler if you have temperature controls on all areas. Most heating people look at the overall capacity and not the areas being served at the time.

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Finally selling the business

• If you have come to the realisation that being a licensee is not for you or your business is under performing get out as soon as possible, explore every avenue before making that ultimate decision, don’t chase a dream it can cost you a fortune.
• If you are tied to two years because of your lease agreement, you have a problem, talk to your Landlords. With leases or tenancies there always appears to be someone who will take it on depending on the fiscal arrangements.
• With a freehouse if you cannot sell it look for an alternative use, it’s value may well be higher than as a pub, it may take some considerable time since the planners are not the most sympathetic and closing rural and urban pubs is an emotive issue, though economic viability is a bigger issue.
• If you are going to sell the business as a going concern, then you need the last two possibly three years trading accounts for any purchaser to arrange finance or convince them that it is viable, if you have good trading figures it should not represent a problem.
• Get three agents including the one you bought it through, if you thought they did a good job to give you a valuation, marketing strategy and costs, avoid being tied to a long sole agreement. Make sure that only the fixtures and fittings that you are selling with the business are clearly defined.
• It is always advisable to sell a business at 2/3rds of maximum take, this leaves room for potential which every would be buyer thinks he can achieve. If you are taking 90% there is no potential and there is only one way to go and that is downward.
• Coping with more than one pub,
• The second or third business may not be able to be run exactly the same way that the original business is being run so flexibility is required.
  Your purchasing discounts change substantially with two or more pubs, you can move staff around in times of crisis and your headaches double. But in the long term a successful small group is always in line for a takeover.