Jon Card, a very good local journalist and regular at The Prince spoke to our boss Keith Marsden about the future of the local pub and the challenges they face.
Have a read at the link below or read the text (please click the link too though!)
Thanks to Jon for a very good article
Pubs are in rapid decline, but why is this happening and what does it say about the UK today?
Pubs have been a part of Britain since Roman times and ale first appeared within these shores during the Bronze Age. The story of pubs is a rich history and tells us much about the people of Britain – if you need to grasp the country’s history, check out its pubs. For instance, pub signs became mandatory in 1393 and taverns mostly displayed pictures of religious symbols, denoting the highly religious and largely illiterate English population of the 14th and 15th centuries. Whereas the prohibitive nature of Victorian legislation tells us much about the gin-soaked towns and cities of the 19th century and the resulting moral indignation that accompanied them. So, what do our pubs tell us about British society today?
Debt and closures
Pubs are closing at a rapid rate across the UK and have been for some time. In the early 1980s there were more than 60,000 pubs in the UK. Today there are fewer than 50,000. Furthermore, their rate of closure has been accelerating and it is estimated that 31 are closing every week during 2014. The typical explanation for this demise is to blame cheap supermarket alcohol and laws such as the smoking ban. But the story is more complex than that and tells us much about the time in which we live. Pubs are also in decline as a result of rising property prices and that other great 21st century intoxicant – debt.
Big breweries dominated the pub scene of the 20th century – they grew vast estates and publicans sold the beer their owner made. But the increasingly free market governments of the 1980s and 90s were never happy with this tightly controlled arrangement and sought to loosen the brewers’ stranglehold. It introduced the concept of “guest beers” and placed caps on how many pubs a brewery could own. The Tory-supporting breweries were both shocked and surprised by this intervention, but had no choice but to comply. In reaction to this legislation came a new type of organisation, the pub company: not a brewer but a buyer of alcohol who retained the “tied house” approach of old. New companies such as Punch Taverns and Enterprise Inns expanded their portfolios dramatically in the early 21st century. They collected the rent, used their buying power to make purchases from the brewers and distillers, and then used this capital to borrow more and further expand.
However, by 2008, the pub companies were in trouble. They had borrowed too much money and the banks, who had their own problems, were recalling their loans. The country was sliding into recession and the now smoke-free pubs were not attracting as many customers as they once had. Also, their own tenants were struggling to make ends meet and had little to reinvest in pubs with fewer customers. The paint was hanging off the wall in the Old Cock and Tesco was offering Strongbow at a quid per litre. Massive sell-offs began as the pub companies channelled money back to the banks. With little legislation in place to prevent it, many pubs were simply sold to the highest bidders. These were often property developers and supermarkets. A recent report from Camra and the Local Government Information Unit (LGIU) showed that since January 2012 no fewer than 208 pubs have been converted into supermarkets.
Communities up and down the country have been shocked to see their old pubs closed down or sold off. Admittedly not every closure is a tragedy, some might indeed have simply had their day, but councils concluded that some laws are just too lax. Cambridge County Council (CCC) took special measures to protect its pubs after a number of high profile closures. The authority undertook a survey of pubs in the city and then created a policy that provides greater protection for a premises at risk of closure. Under current law a pub can have its use changed to other retail uses (such as a supermarket) without the need for planning permission. However, Cambridge hasraised the bar, giving communities the chance to save their pubs and for new owners to be found. One of its stipulations is that any prospective pub facing closure must first be marketed for a year as a going concern before permission for change of use will be granted. CCC says since it brought in the new rules other councils have been in touch to find out how they can adopt this approach.
Of course, one of the best ways for a pub to thrive is for it to be run directly by an owner who has his finger on the pulse of what the local community needs. In the early days of their economic woes, Punch Taverns wrote to all of its existing tenants and offered them the chance to buy their premises. Many obliged and took what were struggling venues and transformed them. Mark Robson, founder of Red Mist Leisure, was one of these. “Enterprise and Punch were buying up pubs throughout the early 2000s on credit. But tenants couldn’t make any money and were literally throwing the keys back at them. They had to sell a number of their assets to pay their debts.”
Red Mist acquired three pubs at a “knockdown price” and began investing and developing a business it believed in. Its pubs are all making revenues of more than £1m per year, but success doesn’t come easy, Robson says. “With pubs you have to spend a lot of money and put a lot of hard work in to get customers through the door. We will buy dilapidated pubs from pub companies at a good price and get people to run them or to take a franchise without getting too greedy about it. The people running them have got to make a living or ultimately they will walk away.”
Tied and free
Keith Marsden has emerged as something of a hero among pub-goers in Moseley, Birmingham. He’s transformed one pub company-owned premises, but has also recently set up a free house. Marsden took over the Prince of Wales in 2007, which at the time was a rather grotty old men’s pub, contrasting sharply with the surrounding hipster area. He saw the potential of the large and undeveloped beer garden at the rear with the smoking ban just weeks away. “We signed the lease a month and a day before the smoking ban. I saw this garden out the back, which was at the time was just a concrete jungle with three mouldy umbrellas and picnic tables and thought ‘ker-ching!'”, he says.
But the Prince was not easy money and a conflict with the then Pub Company, Punch Taverns, nearly led to Marsden’s eviction. However, he soon realised that fighting with the landlord was a road to nowhere and that the best way to win was to concentrate on areas over which the pub company had no control. While beer and cider are tied, spirits are not, and this is why the Prince and so many other pubs are now keen to sell cocktails. “If you go into the back garden of the Prince my entire offering is designed to sell wines and spirits because I can buy them in the free trade. There’s a Tiki bar, a cigar bar and a wine shed. I can get a good margin on a cocktail or a glass of wine, but a pretty poor one on beer,” Marsden says.
But as much as Marsden would like to he’ll never be able to buy the Prince. He offered £1.6m for it, the highest price he thought it could be worth, but it is more valuable to the pub company (now Spirit), which can set prices on beer and rent, than it can ever be to a publican. Therefore, he has recently taken over a new premises in Moseley and reopened it as the Dark Horse. The pub has a wood-fired pizza oven, a smokehouse and even its own brand of beer. He’s glad to be free of tie on this project, but says the decline of pubs isn’t just down to tied houses. “It’s not just how the pub industry is constructed, it also how the supermarkets use beer almost as a loss leader. You can buy beer cheaper than water, which is just ridiculous. The changing demographic of the UK is also a factor. If you look at Birmingham in particular there are areas which used to be Irish and where drinking was a big part of their culture. Now these places might be Somali or other ethnic groups where drinking isn’t part of their culture, so the pubs have gone.”
So what do our pubs tell us about the UK today? Arguably they tell a story of debt, property prices and overly-muscular big businesses and supermarkets. They also tell of booming beer gardens, as drinkers escape the smoking bans, and the popularity of cocktails as publicans avoid the ties on beer and cider. But there’s also a story of entrepreneurs battling away to provide the types of pubs we want in the 21st century. Pub are falling in numbers but are a long way from extinction. The government has taken steps to improve relations between leaseholders and landlords, including the introduction of an independent arbitrator. This is generally regarded as a positive thing. But pubs will continue to change in the future as the UK does also. There are likely to be far fewer pubs in the future than there are now, but their last orders will not be any time soon.