People: A working relationship

What do publicans really want from their company? The results of a new survey give some answers.

Will pub tenants and their landlords ever learn to love each other and live in harmony? Probably not. But an honest, stable business relationship would be something and go a long way to improving the performance and reputation of the UK pub industry.

So what is it, exactly, that tenants want from their landlord? The results of a recent survey carried out by Corporate Responsibility Consulting (CRC) are, on the face of it, not so surprising. The cost of goods - principally the price of tied beer brands - and the size of rent are both in the top three in terms of importance.

These money issues are at the core of the relationship, of course, and there is no simple formula for striking the right balance that can give the pubco its profit while ensuring that the tenant can also prosper.

Other needs that figure high in the list should be a little easier to deliver, however.

At number two comes security, both in terms of the business producing a decent income and in keeping a roof above their heads. Most tenancies will also be the family home, so that makes it doubly important.

A lot of factors feed into a sense of security, of course, so it suggests that companies should be looking at the whole relationship in their dealings with tenants, and not just the nuts and bolts of rent and beer.

It is possible, for instance, that tenants might be able to bear a slightly higher rent if they were confident of the landlord's support in dealing with running repairs, and the maintenance of the bricks and mortar side of the business comes high in importance.

The tenancy agreement itself is also important, with the main concern being that landlords are open about all that's involved in the deal. Agreements should not only be clear, says the survey, they must be comprehensive and not hide or ignore anything.

Another target for concern is the tie. For 95 per cent of the survey the degree of flexibility they have in ordering and stocking is important. Then comes the more abstract notion of "trust". As a measure of the quality of the relationship between tenant and pubco, this comes surprisingly high, suggesting it is an area that landlords could profit from working on.

Trust is even more important than rent reviews, a recurring site for conflict in the trade, and that the company "honours its contractual levels of support" although you would have thought that this would have been vital to earning that trust.

The final factor in the top 10 comes back to the crucial decision-making period before a licensees decides to take the pub. Prospective tenants require "full financial details" of the pub, really the least they should expect if they are taking on a business.

It is obviously a temptation to sex up sales figures to let a pub, but anyone who risks that can only be storing up trouble for later.

Even at this early stage, CRC's research should help pub companies focus their efforts. For instance, a lot of work is put into the "softer" side of the relationship such as publishing newsletters and organising events for their tenants. But as far as the licensees themselves are concerned these come at the very bottom of the list of priorities. For most respondents they are not important at all.

Top 10 most important things to tenants​

• Cost of goods: 89 per cent
• Security: 87 per cent
• Level of rent: 84 per cent
• Support to maintain building: 84 per cent
• Transparency of agreement: 82 per cent
• Comprehensive agreement: 82 per cent
• Flexibility of ordering/products: 79 per cent
• Trust in pubco: 74 per cent
• Negotiable rent reviews: 71 per cent
• Delivery of support promised: 71 per cent

(percentage rating as "very important")​

What pub managers want​

The CRC survey quizzed managers as well as tenants and, in many ways, the answers were not so different. Respondents rated "trust" as the vital factor in their relationship with the boss - 95 per cent said it was "very important". Clearly, if a pub company gets that right, it underpins much of what they are trying to achieve whether it's a tenant or a manager.

Having a "knowledgeable and effective area manager" is at least as important to managers as a good BDM is to tenants, and they also want their requests dealt with speedily. Control over the job is one issue specific to managers, and 95 per cent see the ability to hire and fire their own staff as important.

Health and safety is another major concern - 92 per cent expect the pub to be safe when they take up the manager's post. Efficient maintenance also plays a part in the success of the business, of course, and and even higher percentage of managers want the job done quickly and efficiently.

The most surprising thing, though, is how low pay levels rate. What they get in their salary packets is "very important" for less than one in four managers.

Instead, it's overall job satisfaction and career prospects that fall within the top 10 of the manager's want-list.

Recognition of achievement comes high, however, and if there are to be rewards, it seems that managers are happy for them to be paid as a direct result of their success at the pub. For 92 per cent an individual performance-based bonus is "important" or "very important", and salary reviews rate higher than pay level.

The factors that fall to the bottom of the list are equally instructive. Social events and parties, although commonly regarded as a good way to boost morale, are unimportant to most managers, as is long service pay.

Perhaps the latter will come into play if pubcos start delivering what people expect and retain their staff long enough to make it a meaningful benefit.

• For a full analysis of the tenants' survey, and background to CRC's project click here​.