Running a Pub for a Brewery

Running a Pub for a Brewery

For many, the ideas of running a pub is an attractive option. The hours may be long, but it’s a chance to work in a friendly, people-focused environment – and one of the UK’s oldest industries, often at the heart of local communities. 

When it comes to running a pub, there are a few options – from owning a ‘free house’ pub outright to working as an employed pub manager. But there is a third option – running a pub for a brewery as a tenant landlord, which essentially means leasing the pub from a brewery. 

That option is less available than it once was, however, with the number of brewery-owned pubs having declined sharply since 1990 – brewery pubs accounted for 69% of the market in 1990, but that proportion stands at 23% today. Over the same period, the total number of pubs declined by more than 20%, to around 48,000 in 2017 – the most recently available data[i].

As a result, running a pub successfully is more challenging than it once was, so careful planning is essential – after all, start-up costs can run to £50,000, and rent is often set at around 12% of turnover[ii].

To help you plan, we’ve taken a look at the top five issues to consider.

Running a Pub for a Brewery: Five Issues to Consider

1. Get Training: If you’re new to the pub trade, you will need some training and qualifications, by far the most important of which is the British Institute of Inn Keeping Pre-Entry Awareness Training (PEAT). This is essentially a business course for pub managers and must be completed before any lease can be signed[iii]. You will also need a personal licence to sell alcohol, known as an APLH, which means sitting an exam on topics such as selling alcohol and running a pub to relevant legislation like employment law and trading standards law[iv].

The good news here is the breweries themselves may offer affordable training – for instance pre-entry awareness courses for as little as £100. Meanwhile, some other courses are free as part of a new landlord’s induction process[v].

2. Insure Your Business: As with any business, insurance is vital to protecting your pub against the unexpected. In some cases, the brewery will have insurance for the building itself[vi] but you will need to take out your own cover too.

Covers you need will usually include employers liability and public liability –which cover legal defence fees and any compensation in the event someone is injured or falls ill while working in your pub or visiting as a customer or supplier. On top of that, you will usually need cover for fixtures and fittings, furniture and equipment, stock, frozen goods and money, as well as ‘loss of licence’[vii].

In fact, you may be able to build a tailored insurance policy to cover all your risks in one affordable package. You can find out more here about tailored pub insurance here.

3. Hiring People: It’s fair to say that most pubs are only as good as the people running them. Quick, friendly service in a vibrant, busy atmosphere helps to create a sense of community, and is vital to building a loyal customer base and to attracting new visitors – be they tourists or locals.

If possible, it may be a good idea to retain any existing staff ‒ provided they are dedicated, reliable workers and popular with locals or regulars. Another option may be to work with a dedicated pub staff recruitment agency. But however you go about finding staff, remember to keep on the right side of employment law and take out compulsory employers liability insurance. 

4. Take Stock: Clearly, you will need to buy in stock – from drinks to snacks and food. Remember that, if you’re running a pub for a brewery, you will be tied in to buying your stock from the brewery[viii], but that doesn’t mean you have no control over the kind of pub you want to run – from the mix of drinks available to the type of food. That pre-thinking, along with some information from the brewery around the cost of the stock you will need should give you an idea of running costs.

5. Build Your Business: As with any business, attracting loyal customers and building a good reputation is vital to success. Marketing can play an important part – and these days that should include things like social media and review sites like TripAdvisor. But there are more traditional ways to build trade too – particularly on those midweek nights when lots of pubs are quiet. Events, whether music, quiz or community-based, and themed nights like steak night or curry night, can help to bring in the customers, particularly if they are run regularly and well promoted ‒ both in the pub, outside and on social media.

Running a Pub for a Brewery: The Final Word

Make no mistake, running a pub for a brewery is not likely to be a walk in the park[ix]. But if you get it right, it can be incredibly rewarding so, if you’re thinking about taking the plunge, do your homework and good luck!

[i] https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=12&ved=2ahUKEwjmqLvM2fjlAhVQZ8AKHeAmAO0QFjALegQIBhAC&url=http%3A%2F%2Fresearchbriefings.files.parliament.uk%2Fdocuments%2FCBP-8591%2FCBP-8591.pdf&usg=AOvVaw1EcB4R6rfZxrxsojHKMQWe (LINK TO PDF DOWNLOAD – PARLIAMENTARY BRIEFING PAPER, 26 JUNE, 2019)
[ii] https://startups.co.uk/how-to-start-a-pub/
[iii] https://www.greenekingpubs.co.uk/blog/do-i-need-license-or-qualifications-run-pub
[iv] https://www.greenekingpubs.co.uk/blog/do-i-need-license-or-qualifications-run-pub
[v] https://www.greenekingpubs.co.uk/getting-started/training-course-fees/when-you-join-us#peat
[vi] https://www.fullers.co.uk/pubs/run-your-own-pub/our-support-package
[vii] https://www.smeinsurance.com/food-and-drink-insurance/pub-insurance/
[viii] https://startups.co.uk/how-to-start-a-pub/
[ix] https://www.greenekingpubs.co.uk/getting-started/how-to-run-a-pub

 

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