|Bank of England|
I was interested to read of an initiative in the motor manufacturing industry by Jaguar Land Rover (JLR) to assist its component suppliers secure vital bank lending to gear up for its expected £400 million expansion of its Solihull and Wolverhampton plants.
JLR are giving 22 bankers detailed briefings of its financial plans regarding its growth plans, which, will see downstream purchasing contracts for its suppliers worth £2 billion. By taking the unusual step of disclosing this usually confidential information not only is JLR reassuring lenders that its suppliers will be able to service any debt associated with gearing up but also reassuring the wider market place of what steps it is taking to secure JLR's future.
From what I read, in the trade press and varius forums, publicans, especially those who are tenants or lessees of the pubcos and brewers find it very difficult to get lenders to support their businesses. Perhaps pubcos and brewers with tenanted estates could take a leaf out of JLR's book.
Securing short to medium term finance for Small and Medium Enterprises (and none more so than pubs) has always been problematic as lenders view these businesses in vacuo and not part of a larger concern. It's time for industry "leaders" to start leading and add value to their customers' businesses and thankfully for these cash-strapped behemoths it shouldn’t cost them too much.
The knock on effect for those in the free trade who really are on their own would be increased confidence in the pub industry and a clearer understanding of our complex and varied industry by bankers.
The boost for our much benighted, but vitally important, sector of the wider economy has the potential to deliver an exponential return for all stakeholders and allow the pub trade to be one of the engines of economic recovery … so come on Rooney, Ted, Roger how about co-operating to present a united front to support your thousands of tenant customers?