Psssstttt......

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Pub User Survey Results

Check out my summary of Technomic's pub user survey results on the Market Intelligence Report page ...

Lies, damned lies ... and well, just lies ...

As all you men out there will know it's a statistically proven fact that ManFlu is 20 times worse than WomanFlu (there are statistics to prove it here at Nursing Voices a global nursing forum) ... a fact to which I can currently attest as I shiver and shake on the verge of death ... so you'll excuse me if I'm brief about my disdain and disbelief about the raft of "statistical information" currently being bandied about by the neo-prohibitionists at Alcohol Concern and their myriad ranks of supporters in the 'health industry'.

For a long time now I and others have been high-lighting the inconsistencies in the arguments of the anti-drink lobby but this years Alcohol Awareness Week brings a truly unbelievable slew of 'facts' and figures to support their hysteria.

So if you want to see some of the counter-arguments then I suggest you head over to Pete Brown's Beer Blog and Phil Mellow's Politics of Drinking for some considered analysis of Alcohol Concern's outrageous calumnies.

If you search this blog for my musings on this subject you will see that Alcohol Concern is not alone in its distortion of the truth ...use the search button and look for alcohol concern ...

As for me? Well it may be relatively early in the day to imbibe, but I am going to supplement my Carlsberg Beecham's Cold  & Flu powder with a hefty shot of whisky and retire to my death-bed. If by some miracle I survive my bout of ManFlu I shall resume normal service shortly ... if not, send lilies.

For more factual information about ManFlu check out this highly respected health information site.

How To Be A Tax Avoider...or how I learned to love Amazon, Starbucks, et al ...

Recently I ran a call to action to answer the Treasury's rejection of any review of the beer duty escalator under the image of a ballot box with the tagline "If you can't join them …"

Today, I think I will revert to the more traditional "If you can't beat them, join them…"

Accordingly, I am pleased to announce the formation of The Perfect Pint Company ™. As you will see from the articles of incorporation (to follow shortly) The Perfect Pint Company ™ is based in Luxembourg, where it's highly dedicated staff (of one … me) will provide every independent pub operator in the country with a unique franchise offering.

The franchise will consist of a single piece of intellectual property, to wit, the way to pour and serve the perfect pint (pictured right). In return for the modest fee of 100% of all your takings The Perfect Pint Company ™ will provide you with a handy, easy to use portable diagram and instructions on how to serve and pour the perfect pint and more importantly will undertake to "fulfil" all your customer orders. You will only "deliver the product" to your customers.

Having received your total income, we will provide the invaluable service and management advice contained in The Perfect Pint Company ™ instruction card at the very reasonable cost to The Perfect Pint Company ™ of 99% of your turnover to cover the "cost of product sales and other ongoing costs related to the operations of the company".

The Perfect Pint Company ™ will then pay tax on the 1% of your turnover to the Luxembourg government. By means of a reciprocal licensing fee The Perfect Pint Company ™ will remit to you all monies required to operate your business and fulfil your VAT and PAYE liabilities. The Perfect Pint Company ™ will pay the shareholders of The Perfect Pint Company ™ a dividend on which 10% income tax can be levied in the UK. (You should note that dividends under £35,000 are eligible for a 10% tax credit … so you'll in effect not pay any tax on this income).

The shareholders of The Perfect Pint Company ™ will, of course, be you the franchisees. As your UK based "economic activity" units (your pubs) will be making an operating loss, your UK based pub business will not be subject to corporation tax so you can quite legitimately trouser the difference.

Application forms for potential franchisees can be obtained from The Perfect Pint Company ™ SARL, 13 Rue de la Boucherie, 1066, Luxembourg. Alternatively if you are visiting Luxembourg, call in and collect your franchise pack in person … just knock on the door and say "The one-breasted coffee vendor sent me …" 

(p.s. Brewers will be able to buy their hops from our Swiss domiciled subsidiary at a very reasonable 200% mark-up ...)

Market Intelligence Reports

Some of you will know that I have recently discovered "infographics" and used them in the spirit of " a picture paints a thousand words" ... I've now added a new page to store those (and other reports) that I think may be of interest to those running pubs ... hope you find them useful.

You say tomatoes, I say tomatoes ...

OK ... so I said I wouldn't be doing too many picture posts ... but in light of the Public Accounts Committee grilling of tax-avoiding companies Starbucks, Amazon and Google yesterday ...

Please feel free to use it as you will ...

In the interest of fairness, however, I would point out that Margaret Hodge (Chair of the Committee) must have some major "cojones" if this Telegraph story is to be believed

All you publicans and brewers out there must be wondering WTF is going on in this country when HMRC and HMG are intent on going after the little guy (and gal) when the big boys are getting away with such blatant and immoral tax evasion avoidance ... the "come the revolution" line is growing by the day and must now include not only bankers, but also their 'partners in crime' in the big accountancy firms. Don't you just love the new HMRC adverts?

But closing in on whom?

With reports that the Treasury is facing a £48 billion "black hole" in its books that will require another £22 billion of tax increases or spending cuts in the next spending round, surely it's time HMG sorted this mess out and we had an equitable tax regime where all individuals and businesses paid a "just amount" of tax and contribute proportionally to the societies where their economic activity occurs (pubs and brewers paid a combined £11 billions in duty, tax, VAT, national insurance last year alone) and more importantly inculcate a moral climate where it is seen as the right thing to do to pay one's way and not a jolly wheeze to think of ever more intricate ways to cheat the public purse of one's fair share. Perhaps, and only then, will we feel "we're all in this together".

Quis custodiet ipsos custodes?

You decide ...

Well this is probably a first, me using my almost long-forgotten schoolboy Latin. So, far from being of no use as I would continually harangue Mr Moore (my Latin master), it has come in handy this week. In essence, and at the risk of being corrected by pedants and Latin scholars, "who will watch the watchmen?".

Essentially the current administration of Eton educated Latin scholars has asked this question and come to the conclusion that we, the plebian proletariat, should decide who should watch the watchmen, which is why we are all expected to troop off to the polling station this Thursday (November 15th) to cast our ballots to elect our own Police and Crime Commissioners (PCC)... 37 of them across England and 4 in Wales.

Some may say that this will make the police more accountable and will further democratise one of our public services, namely the police, as unelected Police Authorities will be replaced by a PCC, Others will argue that we run the risk of further politicising the police and their activities and replace a committee of well informed, well intentioned Police Authority members with great experience and breadth of knowledge of crime and how it affects our respective areas with a PCC who doesn't have to have any experience of policing as a prerequisite of candidacy. Whichever view you subscribe to, these elections are upon us and it behoves us in the pub trade to find out who our local candidates are, what they are promising in their election manifestos and consider what will happen to local policing under their authority. 

The government assures us PCCs will have no operational control of our police forces especially in terms of where the diminishing resource of front-line officers will be deployed and what the priorities of those officers will be in the execution of their duties. My fear, and this is a fear shared by many discussing this issue in the media, is that they will; if not by the very dint of being able to hire and fire Chief Constables and oversee police budgets. One can easily imagine a PCC suggesting a Chief Constable immediately puts resources to a perceived problem that the PCC has become exercised about and the Chief Constable resisting this instruction. Result? The PCC sacks the Chief Constable and replaces that officer with one that will do their bidding. Far-fetched? Not really, the Mayor of London has for many years been London's PCC and the current incumbent has already sacked one Metropolitan Police Commissioner... Sir Ian Blair

If you recall Sir Ian's three and a half years in post were plagued by questions about his judgement, leadership credentials and 'politically correct' style of policing. His last months in office were bogged down in unprecedented controversy and in-fighting after he was accused of racism by a series of ethnic minority officers, including the country's top Asian policeman Tarique Ghaffur. It resulted in the upper ranks of the Met being plunged into a virtual state of paralysis, with officers regarding Sir Ian as a lame duck chief no longer in charge of his force. He was forced to eventually resign after a bitter (and very public) showdown with the Tory Mayor of London, Boris Johnson, who said he had no confidence in him, the first time in modern history a Met Commissioner has been as good as sacked.

Is this a scenario we want played out across the country? Well, in some respects, it's too late, the change is upon us, but there is still just a little time to influence the choice of whom we are all going to get. So find out what your local candidate is proposing, think about how it's going to affect your business and your customers and above all make sure you vote. Despite the old anarchist graffito of "It doesn't matter who you vote for, they always get in" ... it does matter and if you get an anti-pub commissioner elected in your area you'll soon know about it. You think late night levies will remain the province of city and town centre pubs only? You think that pub closure orders by the police won't be used by hysterical PCCs in response to health lobbyists and neoprohibitionists? You think that scarce resources won't be deployed only in areas where the most votes for the PCC were cast (or come re-election time might be cast)?

We get precious few opportunities to exercise our democratic right in this country and it would be a shame to squander this one ... if nothing else it'll get you out of the pub for half an hour and who knows you might get a PCC that understands the invaluable role that pubs play in the social cohesion of the communities that both they and the police serve.

Damn and Blast 'em ...

999 WHAT'S YOUR EVIDENCE?

Another of my guilty pleasures is the documentary series on Channel 4 ...  "999 what’s your emergency ?" and having just watched episode 7 I was quite shocked at some assertions the makers of the film Blast Film Productions make regarding alcohol. I have written to them to ask which studies / statistics they base the following statements on at the end of the programme:

1. Drink is a major factor in 50% of all crime
2. It (drink) costs the NHS £2.7 billion a year
3. 1 in 8 of the adults who die before the age of 64 do so because they have abused alcohol

Their response should make interesting reading ...

(If you'd like to ask them to: blast@blastfilms.co.uk)

Update ... 26/11/12 ... quelle surprise! No answer ...

"... you get monkeys"

Today marks the beginning of Living Wage Week 2012, which, will encourage employers throughout the country to bring the poorest paid workers to a pay level above that of the national minimum wage.

For hundreds of thousands of employees currently 'enjoying' the minimum wage of £6.19 this would mean an extra £1.26 (outside London)… not a huge amount, but for those subsisting on what the Labour party call "poverty wages" it will make an enormous difference.

The catering and hospitality industries have been notorious for too long as a low paid sector and in these difficult times of escalating rents and beer duties, increasing commodity and energy prices and the added burden of auto-enrolled pension schemes (which will add 3% to payroll) for some small businesses it may prove to be impossible to implement, but I would urge those that can to do so. Here's a sobering (and shaming) figure for you ... 85% of pub staff in the UK are paid less than the Living Wage.

The Living Wage Foundation cites these reasons for paying a Living Wage:

Good for Business

An independent study of the business benefits of implementing a Living Wage policy in London found that more than 80% of employers believe that the Living Wage had enhanced the quality of the work of their staff, while absenteeism had fallen by approximately 25%.

Two thirds of employers reported a significant impact on recruitment and retention within their organisation. 70% of employers felt that the Living Wage had increased consumer awareness of their organisation’s commitment to be an ethical employer.

Good for the Individual  

The Living Wage affords people the opportunity to provide for themselves and their families. 75% of employees reported increases in work quality as a result of receiving the Living Wage. 50% of employees felt that the Living Wage had made them more willing to implement changes in their working practices; enabled them to require fewer concessions to effect change; and made them more likely to adopt changes more quickly.

Good for Society 

The Living Wage campaign was launched in 2001 by parents in East London, who were frustrated that working two minimum wage jobs left no time for family life. Over 15,000 families have been lifted out of working poverty as a direct result of the Living Wage.

As I have said this may be impossible for many small businesses, none more so than the hard-pressed tenants of brewers and pubcos, so here's a suggestion for the likes of Punch and Enterprise, the pub trade's corporate Rackmen … for any tenant that signs up for the Living Wage, how about rebating the differential between that and minimum wage by means of reduced rent?

For a pub employing ten staff, say, this would be about £466 a week, or £24,000 or so … too much? How about going halvsies? £12,000 per pub to repair your reputation? Can't afford the cash? How about a free 11 gallon keg of lager per week? The tenant sells the lager at 100% profit and that goes to fund the Living Wage, surely you can afford that out of your massive supplier discounts? How about that for a bit of preredistribution?

And as for government, isn't it about time that the Living Wage became the national minimum wage? I, for one, can't understand the rationale of a prime minister supporting the aims of the Living Wage Foundation presiding over an administration that enforces a minimum wage that is 17% below what is actually needed to survive on or values the work one does based on age. But then again, nothing that Whitehall and Westminster does surprises me anymore. (By the way I bet that scrapping the beer duty escalator would go a long way to funding the Living Wage in pubs anyway).

A final word for publicans, if you are already paying the Living Wage or above, then bravo, if you aren't then seriously consider it after all as grandma said … "If you pay peanuts …"

(This piece amended with new Living Wage set at £8.55 for London and £7.45 outside the capital 5/11/12)

Enough with the pictures already ...

Those who read this little corner of the blogosphere will have noticed that recently I have been using a lot of what data journalists call infographics ... don't know which is worst the former or the latter ... but hey ho it has been useful as a way of spreading the message in another forum, namely, Twitter.

With a limit of 140 characters (or if you follow 'best practice' 100 characters) the constraint on meaningful and articulate messages can make communication for a wordy old bugger like me a bit of a challenge ... hence the need to create attachments to tweets that fully convey the point I am trying to make.

This has been incredibly useful over the last week or so in the lead up to yesterday's back bench business debate in the House of Commons on the beer duty escalator (scrapping thereof). I like to think that in some small way that the combined 'reach' that some of these images achieved has helped inform the wider debate and acted as a call to action for those in the trade (and their customers) who might not ordinarily participate in 'politics'.

There are many who say that religion and politics are things that any publican should steer clear of, in their own pub at least, and there are those that say simply getting out of bed is a 'political act' ... but with so much at stake for our industry and that of our suppliers, most notably brewers, I think it behoves all of us in the trade to engage with our customers on the issues facing us and (by dint of association/custom) them.

With unprecedented pub closures in recent years, brought on by many factors already discussed here and elsewhere, yesterday's debate in Parliament was, thankfully, not just about getting a tax break for pubs and brewers, it was an impassioned and evocative plea to save what is, for many people, the quintessential social institution in this country.

So when you, your colleagues and your customers can't be bothered with the issues facing our industry, stop, take a moment, and participate in the debate ... without 'grass roots' support no matter what is spent by industry lobbyists or said by the trade press or pundits such as myself, any efforts to effect changes to the way this administration act toward our industry will ultimately fail or be a waste of money.

So occasionally, if I drop a picture or two into the blog, to illustrate a point, I trust you will forgive me ... hey, you can always pass it on to your customers without having to spend endless hours proselytising and maybe the next time we get our say, in the next General Election, our views might be heard and taken note of by those whose political base relies so heavily upon our customer base.

Now vicar about that ecumenical discussion about those angels dancing on the head of that pin ...

Enjoy the weekend ... and look no pictures!

A picture paints a thousand words ...

Another in my series of a picture paints a thousand words ...

*Living Wage currently £8.55 an hour in London, and £7.45 outside the capital

More tales from the crypt ...

Roger Whiteside - CEO Punch Taverns plc ?

As Hallowe'en approaches I thought I'd bring you some spine-chilling tales from zombie pubco Punch Taverns, but first let me remind you of the dictionary definition of a zombie: 

  

“the body of a dead person given the semblance of life, but mute and will-less, by a supernatural force, usually for some evil purpose”

I use the word zombie because this behemoth of the pub trade is currently in debt to the tune of £3,665,800,000 or to use the far less visually impressive common parlance £3.665 billons. ( Source Punch Prelimiary Results for the 52 weeks to August 18th 2012 ) Which is 76 times their annual profit ... which is an impressive profit to debt ratio by any reckoning! Scared yet? As an investor I would be, especially with today's share price. If you bought shares in January 2008 at about £1.25 a share they would be worth 6.55p each today, where as if you'd invested elsewhere in the "Travel & Leisure" sector your initial share value would have stayed just about the same. Surely you must be a little frit by now?

Punch Share Performance (Source www.punchtaverns.com)

OK then let's look at in terms of the tenants of this debt-whale ... Punch is proud to say that it is going to divest itself of 1,595 pubs in the staggeringly misnamed "Turnaround Division" ... the strategy for which is quite blatant in its remit ...

    "Maximising short-term returns: While these non-core pubs remain in our portfolio, we remain committed to driving operating performance and maximising the profits from these outlets."

Anybody else think the only thing missing is the corollary of "... by all means possible and at whatever cost to the tenant"?

The time scale for disposing of these "non-core" assets? For the "sell now/sell later" category (1,029 pubs) it's 1 to 3 years until it's 'goodnight Vienna' and for the "protect and grow" segment if you're in one of these 566, congratulations you're not scheduled for the garbage chute for 3 to 5 years. Either way don't make any long-term plans ...

Ready for some really shocking reading? Then if you're sitting comfortably ...

Number of pubs in turnaround: 1,595, gross margin on drinks revenue totals £34,639,072 or £51,598 per pub, which on drinks sales to you tenants of £82,300,000 equates to 42% gross margin. Not bad for just placing a few telephone calls and taking your orders, no deliveries to be seen in or pipes to be cleaned either!

Which leads neatly on to the total gross margin (drinks, rent and machines) they make on turnaround pubs which is £67,058,686 or £42,043 per pub ...


Now how about you 2,934 tenants in the core estate ... how's it looking for you? Well Punch sold you a whopping £269,100,000 worth of drinks from which it derived it's customary 42% profit of £113,260,928 ... which on average is £91,717 per pub. The total gross margin they achieved was £220,141,313 or £75,031 per pub.
  
The really scary language though is saved for the creditors ... 

"Both securitisations are over levered and unsustainable in their current form; Significant amendments to each of the Punch A and Punch B securitisation structures are necessary, including one or more of a material reduction in debt, an increase in the maturities of the debt and changes to the financial covenants; "

Or put in lay terms "We can't pay what we owe you, it's impossible, can you let me off some of the debt or change my credit terms?" ... something many of you may have asked Punch for ... no need to take a poll on what their probable response was.

Time for all good (wo)men to come to the aid of the party ...

So Parliament is to debate scrapping the Beer Duty Escalator on November 1st...



So if you ...

a) drink in a pub
b) drink at home
c) brew beer or work for a brewery
d) manage a pub, work in a pub
e) are the tenant at a pub
f) own a freehold pub
g) own a pubco, work for a pubco
h) work in the logistics chain that supplies pubs and breweries
i) work in any ancillary industry servicing the pub trade




... contact your MP and tell them you expect them to support any motion to scrap the duty escalator.

If you don't know how to contact your MP go to They Work For You where you'll find an easy postcode search facility.

And more is less ...

Just an adjunct to yesterday's post, as the British Beer and Pub Association announced that UK beer sales fell by 4.8% in the last quarter compared to the same quarter last year. This drop on top of falling beer sales in the previous quarter of 5.3%.

In six months that means a total 166,000,000 less pints sold,

... the message sinks in?

which, using CAMRA's estimate of £1 per pint (on average) means

  

£166,000,000 less tax paid,

so my question to this economically illiterate Chancellor is

 which bit don't you understand?

Less is more ...

No chance of that with the current administration ... minimum pricing, late night levies, duty escalator, business rates revaluation freeze ... and a Chancellor that does not appear to understand the basic economic principles of 'inelastic demand' and the law of diminishing returns as demonstrated in The Laffer Curve.

Apart from fascinating research by those interested in the societal impact of alcohol consumption, such as the University of Sheffield, little seems to have influenced the political debate, however, a new report by the Institute of Economic Affairs, Drinking in the Shadow Economy, may change that. 

Perhaps a helpful civil servant will slip it into Georgie Porgie's red box ... and maybe he will then take notice of what many of us in the hospitality and brewing industries have been saying for sometime. That the third highest rate of duty (let alone other direct, indirect, and pseudo-taxation) is counter-productive:

"How do we explain the apparent lack of association between affordability and consumption? Demand for alcohol is relatively inelastic and drinkers have a series of options in front of them when real prices increase. They can do as the government hopes and drink less, but they can also do any of the following: (1) make savings elsewhere in the household budget, (2) switch from the on-trade to the off-trade, (3) downshift to cheaper drinks, (4) shop abroad, (5) brew or distil their own alcohol, (6) buy counterfeit or smuggled alcohol, and finally (7) buy surrogate alcohol (e.g. methanol, antifreeze, aftershave). The extent to which consumption patterns change depends on personal income and the price of drink. There is little doubt that financial considerations have helped shift drinking from the pub to the home in countries such as Britain,"

(above from the IAE's report)

 ... in short we Brits like a tipple and 'nudge economics' or crippling taxation won't curb that desire.

How much will the cost be of this country's punitive alcohol taxation regime?

"Contrary to temperance rhetoric, high alcohol taxes are not necessarily good for public health
because, although excessive alcohol consumption undoubtedly carries risks to health, so too
does moonshine. Counterfeit spirits and surrogate alcohol frequently contain dangerous levels of
methanol, isopropanol and other chemicals which cause toxic hepatitis, blindness and death. These are the unintended consequences one associates with prohibition, albeit at a less intense level than was seen in America in the 1920s.

It scarcely matters to the politician whether unrecorded alcohol comes from legal or illegal sources.In either case, the treasury loses out on revenue. In Britain, HMRC estimates that the alcohol tax gapcould be as much as £1.2 billion per annum, plus the costs of enforcement, and that this is largely because ‘duty rates on alcohol are far higher in the UK than in mainland Europe’ (National Audit Office, 2012: 2, 10). This is the price the state must pay for excessive taxation, but the politician is also aware that these high alcohol taxes raise £9 billion a year (Collis, 2010: 3). Being in possession of these facts he may conclude that reducing the illicit alcohol supply through tax cuts will probably reduce net alcohol tax revenues.

We argue that such a focus on maximising tax revenues is short-sighted and carries significant risks. Failing to deal with alcohol’s shadow economy threatens not only the public finances, but also public health and public order. Unrecorded alcohol has, as( Nordlund and Österberg note, ‘the potential to lead to political, social and economic problems’ (Nordlund, 2000: S562). In addition to the health hazards presented by unregulated spirits, alcohol fraud in the UK is, according to the HMRC, ‘perpetrated by organised criminal gangs smuggling alcohol into the UK in large commercial quantities’ (HMRC, 2012: 8). Alcohol smuggling and counterfeiting is linked to other illegal activities, including drug smuggling, prostitution, violence, money-laundering and - in a few instances -terrorism."

(ibid - my highlights)

How about that then? Is this litany of criminality a "price worth paying"? The IEA certainly don't think so ...

 "It is too early to say whether the recent well-publicised cases of large-scale illegal alcohol production in the UK represent a lasting shift towards a Moonshine Britain, but it may not be a coincidence that they have come to light at a time when regulated alcohol has become less affordable as a result of successive tax rises and a major recession. Policy-makers should take the threat of illicit production seriously when considering alcohol pricing in the future."

 (ibid - my highlights)

But then again when has reason & research ever been so outweighed by rhetoric and dogma than with the current government?  Perhaps a little less demonisation of the ordinary drinker might lead to more positive results than a temporarily bulging Treasury ... it would appear (from this, albeit somewhat subjective discussion document) that more taxation will lead to more unintended consequences both in terms of public health and public order. I know which I would prefer ...

So long Chief Whip ....

buy the tee-shirt ...

WTF? Is Jo Swinson Out Of Her Mind?

I was totally gobsmacked to read in the Publicans' Morning advertiser that Jo Swinson MP the minister responsible for monitoring the self-regulation deal for the pub industry has decided that all the commitments "have now been achieved".

I have taken the time to prepare an email template for those interested to know how she came to this conclusion and might wish to ask the minister WTF?

You can access the document here ... http://twitdoc.com/1IQX

I urge you to send her this enquiry ... or one of your own wording

One rule for them ...

The ever informative Propel.Info Newsletter contains a fascinating little snippet this morning, that bears sharing to a wider audience and certainly got me thinking ...

Mike Tye and Spirit Pub Company

" Spirit aims to raise £2.1m by selling three freeholds let to Tesco Express at auction today: Three Spirit Pub Company freeholds let to Tesco convenience stores will be auctioned by CBRE today. The three sites are: Tesco Express in Orton Wistow, Peterborough, with a guide price of £750,000 to £760,000 (rent is £56,000 per annum); a Tesco Express in Burley Road, Leeds, with a guide price of £600,000 to £610,000 (rent is £45,000 per annum); and a Tesco Express in Gracemount Drive, Edinburgh, with a guide price of £720,000 to £730,000 (rent is £50,000 per annum). "

The first thing that stuck me was how little the rent being charged on these buildings is. One can assume that the other income streams that pubcos usually derive from their tenants (principally discount income from tied product purchases by the tenant and gaming machine income) are not flowing in from Tesco, so the total income stream is limited to the rent paid by Tesco. 

Which beggars the question of what is a fair market rent in the eyes of pubcos such as Spirit or its step-sister company Punch Taverns? If there are no ties for wet products or gaming machines in these supermarket leases aren't they, in effect,  the equivalent to a free of tie lease, and therefore a free of tie rent? (I know, somewhat simplistic but many tied tenants of these rapacious companies might easily come to the same conclusion). 

Using historic multipliers (such as those used on the How To Run A Pub freehold calculator) to determine an approximate level of trade, would mean that the Peterborough site would trade at 200 barrels; the Leeds site 150 barrels, and the Edinburgh site 210 barrels (all with a nominal £2,000 gaming machine income p.a.) So Spirit have been forgoing £52,000, £41,000 and £54,000 respectively in terms of discount and other income from Tesco and still managed to satisfy their internal profit requirements every year on all these sites.

Which brings me on to the second thought that sizzled through my noggin ... and all this to one of the most irresponsible retailers of alcohol in the UK marketplace ... Tesco ... a supermarket, that along with its competitors, is widely accepted as having had a hugely deleterious effect on the UK pub trade. 

What a signal message this is to its tied tenants ... "we'll not only screw you with unsustainable levels of rent and eye-watering levels of tied product pricing, but we'll also subsidise your most voracious competitors until we can sell your pub to them at auction" ... bloody nice business model! No wonder Spirit is so desperate to bring in new 'business models' such as the three tiered franchise system they are peddling presently.

I wonder how many Spirit (and other pubco tenants) are thinking ... "fool me once, shame on you ... fool me twice, shame on me..." ? 

Well to them I say ... "SHAME ON SPIRIT , NOT YOU ! " ... and all this before breakfast and my morning meds ...

Alcohol To Be Means Tested

Yet again the 'dead-hand' of unintended consequences may be at the helm of Britain's ship of state. In a piece in the Telegraph this week, a worrying example of upperclasshole thinking has surfaced.

Iain Duncan Smith (IDS)has asked his officials to see if so-called ‘problem’ families should receive their welfare payments on smart cards, rather than in cash.

The cards would only be able to pay for “priority” items such as food, housing, clothing, education and health care.

The Work and Pensions secretary wants to stop parents who are alcoholics or who are on drugs from using welfare payments to fuel their addictions.

The team of civil servants in his department have been asked to come up with proposals by the end of this month.

However the Government cannot currently stipulate how people spend their benefits money and the law would need to be changed to do so for certain groups.

He (IDS)said: “I am looking at the moment at ways in which we could ensure that money we give them to support their lives is not used to support a certain lifestyle."

It's not for me to say whether the '(un)deserving poor' deserve a drink or not, one may see this as a totally benign measure to protect the children of disadvantaged "problem families" … but what it is for me to say is that this is just the latest salvo in the "war on alcohol" that is being waged in this country through alcohol's continued demonisation by the 'worthy few'.

At which point does the policy stop? Will the next step be for anyone receiving any state benefit be subject to this form of creeping prohibition? Those in receipt of tax credits? After that, students, perhaps? After all they will be receiving the largesse of the state in the form of their student loan, that until they reach a certain level of salary remains unpaid. Will graduates only be able to consume alcohol when they have paid their loans off? How about pensioners?

What about all those pesky public servants … such as the nuMPties themselves? Will they be forced to give up alcohol as they are paid from the public purse? (I feel sure it would stop just short of them somehow …)

If ever there was a better example of the disjointed thinking of this administration then I am temporarily at a loss to find one … as if those affected by this measure couldn't find a way to get round the system … or perhaps IDS (Irritating Dickhead Syndrome) thinks that they are as stupid as him?

I suspect that even "Conservative Home" didn't bank on this gem of a "bold step"...





Ho hum off for a pint, whilst it's still legal …

Updated, 19/12/12 ... is the idea gaining traction with Alec Shelbrooke, who has drafted a Bill that would change the law to allow welfare payments to be made on a new “welfare cash card” whose use could be restricted by the Government:

"Introducing a welfare cash card on which benefits will be paid, claimants will only be able to make priority payments such as food, clothing, energy, travel and housing. The purchase of luxury goods such as cigarettes, alcohol, Sky television and gambling will be prohibited”

 Just one more arrow in the quiver of those who continue to demonise alcohol ... just call me Cassandra ...

Shock Horror - Students Talk Sense!

Hope for us all?  (this one in Smithfield)

Hat's off and a resounding three cheers to the group of Kingston University architecture students who have submitted a proposal to UNESCO to grant World Heritage status for the London Public House as a "type".

"When you talk about a special pub and what's unique about it, it suddenly seems a bit futile to only protect the physical elements of the building, without thinking of who uses it and for what," says tutor David Knight, who oversaw an army of 435 students compiling a survey of 87 distinctive or typical London pubs, including one-minute Lumière-style films.

 "Hopefully our survey can start to describe more than just the physical things, or rather understand how they relate to occupation and the needs of the pub's community," he says.

"For example, it could be that the loss of an upstairs function room has a catastrophic effect on a pub which is used by community groups for meetings, wedding receptions, and so on. Accordingly, our research captures extraordinary examples but it also aims to try and describe the typical, or generic qualities of 'London pub-ness' which might influence policy."

The London pub, and I would venture a good many in the rest of the country are deeply embedded in this country's cultural identity and of immense social and economic value. What a shame that so many are still closing on a permanent basis to be replaced with convenience stores and residential developments.

To make it on to such an august list, the heritage subject must meet a range or criteria in the assessment of Outstanding Universal Value, which include "representing a masterpiece of human creative genius", "containing superlative natural phenomena", "exhibiting an important interchange of human values", and "bearing a unique or at least exceptional testimony to a cultural tradition".

There is no doubt that the great British pub, whether in the capital or not, is a work of genius, exhibits an invaluable medium for the "interchange of human values" and undoubtedly provides "exceptional testimony" to our rich "cultural tradition". The 350 page submission has been sent to the Department for Culture Media and Science and I sincerely hope it is taken up … maybe one government department at least will formally recognise what the rest of the country do, that pubs in all their guises and locations are an integral part of UK life, UK culture, UK plc … and then, just maybe, other departments such as the Treasury will take note and start giving our much benighted industry a break.

With thanks to Oliver Wainwright in the Guardian for bringing this to my attention, as he says " If Viennese coffee house culture has made the list, surely our humble London pub can too."

Beer, beer, lovely beer ... well some of it ...

It's that time of year again when The Cask Report (now in its 6th year) is published and our collective thanks should go to the redoubtable Pete Brown, for his sterling work in authoring this 'state of the nation' address.

Required reading for any publican its comprehensive view of cask ale, how it's perceived and how it's developing can be downloaded here.

There's a wealth of statistics based upon market research and if you are selling (or considering selling) cask ale the section on perfect mix of ales is invaluable.

On a slightly dissident note, however, I would once again reiterate that the brewing industry in all its myriad forms from domestic brewers, to micro-brewers, to town brewers, through to the regional and national brewers is continuing a great tradition of brewing in this country and that no matter the medium of delivery, all beer should be celebrated ... be that cask, keg or bottled.

So perhaps next year the report will simply be re-titled to be The UK Ale Report, or some-such, and Mr Brown will further amaze us with insights into all forms of beer brewed in the UK ... as the report in its current form doesn't really encompass or inform us of the total picture of the British beer market ... just a thought ... as if the manufacturers of the recyclable 'Pertainer Keg' gain purchase as reported by Tandleman then maybe artisan or craft beer or real ale or whatever we call them will evolve in a way that makes the word 'cask' somewhat redundant.

Is this the alternative to Minimum Pricing?

Not In Ipswich ... not in a town near you soon?

Much has been written (on this blog) and elsewhere about the potential for Minimum Pricing to drive down incidence of problematic (ab)use of alcohol. Regular readers of this blog know full well my opinion … it won't work; they will also know my view that proper implementation of licensing law to force both on and off trade to be 'responsible retailers' is the route to take, if for no other reason than the legislation and machinery to enforce it are already in place (just not being used to full effect).




So it was interesting to read in today's Independent (and just now listening to the BBC) that Ipswich is rolling out their "Reducing The Strength Campaign" in a bid to remove 'super-strength' beers and ciders (above 6.5% ABV) from their micro-marketplace. So far 40% of off-licence outlets (including some of those most guilty of 'pocket-money pricing') have agreed to the initiative. The Independent implies that the murder of "four street drinkers … in the last three year" has, at least in part, prompted this action.

Ipswich and Suffolk Councils say:

"We are positive that the Reducing the Strength Campaign will have significant, long-lasting, positive effects for the people of Ipswich.

"The negative impacts associated with super strength alcohol are significant for the consumer and the wider community, but also for the public services who deal with the consequences.

"This campaign aims to take the problem away at the source.

"We hope that licensees will share our belief in the positives associated with becoming 'super strength free' and that they will recognise the huge benefits that can result from removing these products from their shelves.

"We are the first county in the country to launch a campaign of this kind, and we hope that with support from our off-licences, we can roll this out across Suffolk, and eventually offer the campaign as a model for public services across the UK."

Just a few questions on all this:

1. Isn't it shameful that in order for both retailers and local licensing authorities to take action that four people have to be murdered first?
2. What will happen if the remaining 60% resist, for some will as diminished supply in one sector of a market place is usually reciprocated in another section as consumer demand continues, this for the more unscrupulous will mean increased sales (and presumably increased profits). Will the licensing authorities seek to impose this as a licensing policy, that's if it was legal and not a 'restriction of trade'?
3. If this is rolled out across the country by local or national politicians seeking a quick fix to the problem of binge drinking (always a vote winner that one) will it stop at the off-trade or will it then 'mission creep' into the on trade? Will the threshold of 6.5% ABV fall to encompass many beers and ciders sold in the responsible retailing environments of pubs?
4. … and yet again, how come only beer and cider comes under the microscope? What about the cheap wine and spirits deals? Could it be that the good officers and councillors of Ipswich and Suffolk don't drink White Lightning and Tennent's Super but enjoy a dram or the odd bottle of Chablis instead?

We certainly need to do something about 'binge drinking' and maybe this is the way forward, as opposed to Minimum Pricing, which has the potential to be so manifestly unfair to those who do drink responsibly and those who are economically disadvantaged but still fancy a tipple. But be careful what you wish for, creeping regulatory control is no substitute for carefully crafted legislation born out of full political dialogue and engagement with the electorate.

Perhaps widening the 'national conversation' to ask consumers as well as retailers nd manufacturers what solution to the problem is required? But that would mean actually listening to voices with no 'vested interests', be it the drinks or the health industries … not going to hold my breath on that one.

Oi, nuMPties, we have spoken!

On February 15th 2012, Chris Schofield started e-petition 29664 ... it called on the Treasury to Scrap the Duty Escalator that is causing so much damage to the British pub trade and brewing industry. (thanks to Rob Willock from the PMA for correcting me ... doh!)

At 10.26 am today the petition received the necessary 100,000 signatures required to "force" Parliament to debate the topic. Thanks again to Rob (sic) for pointing out also that it is one of only 12 to get this far ...

This and previous administrations have done incalculable harm to our sector of the economy both by sin of inclusion and sin of omission.

I have no doubt that any Parliamentary debate will see honourable members wring their hands and decry the death of the British pub.

I have equal certainty of belief in the intransigence of the Treasury in this matter and that the Duty Escalator will remain in place.

That shouldn't stop us, however, from continuing to voice our dissatisfaction with the (in)actions of this, past and future government and highlighting the social and economic importance of our industries.

The next step is to challenge the preposterous notion that Minimum Pricing will be the silver bullet to cure all social ills, but especially the scourge of alcohol abuse that we as an industry do so much to combat, whilst still trying to earn a living.

It may have taken 218 days for 100,000 to sign epetition 29664 and it may take even longer to get the requisite 100,000 to sign epetition 31885, but I for one will continue to shout it from the digital rooftop ...

HANDS OF OUR PUBS!

You can sign the epetition on Minimum Pricing by clicking the link on the right hand side of this page.

So the Parliamentary summer break is over, kids are back at school and students have returned to the hallowed groves of academe ... our 'once in a lifetime' summer is over so I thought it might be useful to recap on where we were before we left off in July ...

MP Aidan Burley called for an end to the “boozing, alcoholic culture” of the House of Commons on the 19th as the commons select committee on Health condemned the drinks industry for not doing enough to combat alcohol misuse ...

My website, How To Run A Pub, got hacked and has been undergoing a total re-build ...

Two of our brewers, Greene King and Adnams exhibited the schizophrenia endemic in our industry, the former supporting minimum pricing the latter condemning the relief from duty escalator for the smallest of brewers, whilst a major operator, Tim Martin of Spoons fame gainsays the minimum pricing argument ...

Marston's reported on the potential of Premium Bottled Ales (for the off-trade anyways) and Everards, the Leicestershire brewer decided to use some of its excess yeast to support a bake-house pub concept in Birmingham ...

The Joseph Roundtree Foundation made sense in telling government to stop cutting provision for young people ... you know those pesky things like youth clubs ... as an alternative to drinking alcohol and CAMRA's 40th Good Beer Guide celebrates a return to brewing numbers not seen in this country for over 70 years and we've got a new sobriquet for the residents of No 10 and No 11 ...

So not a lot changed really, which, means as the autumn politi-fest of party conferences is imminent and the pub trade's opportunity to hammer our message home is coming too with (at the time of writing) only 1,864 signatures needed on the Scrap the Duty Escalator e-petition ... so what can you do?

1) Sign the petition, if you haven't done so or get someone else who hasn't to do so
2) Write to your local MP and set out what you think is wrong with the pub trade and what government can do to help us or what they can do to stop screwing up our industry (your choice)
3) Remember that feeling of Super Saturday and Super Human Sunday when we all felt like lions and carry on showing the nay-sayers why pubs are the social lynch-pin of this country just as the purple clad volunteers were the social glue of the games ...

1,062 and counting ...

Widely reported in the press today (and even featured on the Today program on Radio 4) we as a nation can proudly boast over a thousand brewers, the highest number for over seventy years.

This phenomenal growth (158 new breweries in the last year alone) despite all the health lobby and successive administrations have done to try and cripple the brewing industry and heritage of this country has to be celebrated ...

So to mark the occasion I have added a new "useful link" unsurprisingly on the useful links page to a nifty little site called aletalk

25 in the Nottingham areas alone

With lots of features including a calendar of beer festivals, blog, forum this really is a fantastic resource

My favourite feature on the site is the fully searchable database of UK breweries and beers ... as of today 1,062 of the former and a staggering 8,833 of the latter ... it the has additional functionality of putting breweries/beers on a map for you so you can find all those in your area ... with details of the location, contact details, beers brewed, brewery tours, shop ... all any beer lover needs.




Fantastic chap(pesse)s ... long may you continue.

Fiction, not stranger than fact ...

Laughing all the way to the bank ...

Being somewhat of a traditionalist it's not often that I am moved to put digit to keyboard on a Sunday, however, I thought I had to share a few thoughts on last night's 'fly on the wall' mockumentary, the BBC's most excellent, "The Thick of It".

What a delicious 30 minutes of satire that if it weren't so close to the reality that is British politics and so ball-achingly accurate a portrayal of the current (mis)administration would be truly hilarious.


I could rant on and on about the lack of joined-up thinking or morally bankrupt posturing that many nuMPties indulge in whilst racking up an eye-watering expense roll that totals nearly £90millions last year ... yes 650 of them costing a mean average of  £138,000 ... but unfortunately the kindly nurse who brings me my medication on such occasions does not work on the christian sabbath.

Suffice it to say, the sobriquet dropped into the fast-moving dialogue to describe the 'senior partners' in the coalition will now feature heavily in my lexicon ...

"upper-classholes"

... so simply and utterly brilliant, this single phrase is an entire justification for the Licence Fee.

Just Kidding ... Not!

Apologies to those who may have read about the Joseph Rowntree Foundation (JRF) Report onLocal Variations In Youth Drinking Cultures elsewhere. Which is my way of saying "damn your eyes Pub Curmudgeon" for beating me to the draw.

Mudge quite rightly points out some of the obvious correlations and findings contained in the report and is 'bang on the money' about the more asinine suggestions such as devoting more space to dancing to combat problematic drinking habits in the young adult market (18-24s).

My take on the report (sic) is not on the planning implications and recommendations for youth oriented drinking clusters, it's on JRF's implied criticism of this (and one assumes) previous administrations general youth and alcohol policies.

Here are some of the conclusions to the report offer to which I offer up the following:

Removing drinking clusters from areas associated with other young people and children - cinemas, bowling alleys, transport hubs/bus stops - all well and good, but without wholesale re-zoning and changes to the transport infrastructure I am not sure how this would be achieved.

"Encouragement for variety within youth drinking clusters: specifically tax breaks (business rates or the proposed late night levy) might be offered for properties that have a substantial area for dancing, live music and/or alternative ‘fun’ entertainment activities." The solution may be innovative, but I fear has little chance of success, I should imagine cash-strapped local authorities would be loathe to forgo any part of their dwindling revenue streams. Notwithstanding Curmudgeon's observation that extending dance facilities would only "stoke the febrile atmosphere", what the report fails to acknowledge or mitigate is the attraction of alcohol, whether consumed as a primary social function or as ancillary to activities such as dancing. Young people like to drink, period. It's part of their perceived right of passage from child to adult, and in all too many cases, the cheapest anaesthetic they can find for their boredom.

The report goes on to urge more recognition for "designated drivers" and offering low/non-alcoholic drinks along with more tax breaks in lower duties for low-alcohol products.

All good so far, and all things the hospitality industry have been campaigning for, but the real slap in the face for any section of those concerned with the issue of alcohol (mis)use by the under-aged are the following observations:

"Providing more funding for, rather than cutting back on support to, youth services, voluntary groups, sports and other types of non-alcohol provision aimed particularly at 12- to 18-year-olds." - bit of a no brainer there, but if the current administration continues hell-bent on more cuts this isn't going to happen 'Olympic legacy' or not.

Ditto "Channelling more funding to local government to raise the quality of parks, green spaces and shopping centres as places for activities or simply to ‘hang out’ for young people."

I doubt if there will even be the monies available for "The continuation of funding for partnership working between local authorities, the police and the health service to combat underage drinking, through early intervention, directions to leave and ChildSafe schemes, ID schemes, and enforcement campaigns on underage and proxy purchasing." Given the parlous state of local authority finances, one senior Tory commentator, the head of the Local Government Association, has warned "Councils are working hard to shield frontline services from the 28% cut to the money they receive from government ... If councils plundered their reserves to cover the cuts, the cupboard would be bare within five years ..."

So what is needed? Certainly not more disjointed thinking, as the current administration is exhibiting with their alcohol strategy and economic policy. As an industry we need to capitalise on findings such as the JRF report, it's time to stop being perceived as the cause of all society's ills and speak up for the immense good we do... jobs, taxes/duties, responsible retailing, social cohesion... but unfortunately our industry seems just as incapable of joined-up thinking as the nuMPties as evinced by recent reports.