Brand boost pulls M&B out of sales quagmire

by The PMA Team Managed pub operator Mitchells & Butlers has reversed declining sales across its estate ­ in both high-street and suburban pubs ­ in the past five months by offering a wider range of products in 1,400 of its 2,077 pubs. The company is now offering three leading brands in each major draught category. It is dual-stocking Coors and Carlberg-Tetley products, has introduced Stella Artois at 1,200 pubs and has begun a small trial of Scottish Courage brands. In October and November, the new products and a range of targeted offers helped boost volumes by 7.5%. Overall, average price is down 3.7% in the past two months compared to a year before. Chief executive Tim Clarke said: "We're finding customers are responding very well to the range and choice we're offering. The sales graph is steepening upwards. "The key factors have been range [of product] together with all of the activity in terms of service, incentive schemes and promotional activity coming together. It's all about driving the market share and competitive advantage of the large managed house." Harvester, Ember and Vintage Inns ­ a total of 504 pubs ­ have been "powering ahead" with sales gains of 5.7% or more in October and November. M&B also saw sales growth on the high street of 2.3% in invested sites and 0.6% in uninvested. Clarke said: "The high street has serious systemic over-capacity. In a market with the depth of problems the high street has, you've either got to have a very strongly differentiated offer ­ like All Bar One or Flares ­ or you go very strongly for value ­ like Goose." Clarke revealed that a trial at six sites of a value-led bar that adopts the post code for a name ­ dubbed Bar Code internally ­ was being extended to five more sites. "It's a piece of research and development. We're pleased with it, but we'll have a much better idea of whether it's going to become a big part of our business in six months' time." Clarke denied, however, that the future of Edwards, which has seen several sites converted to Bar Code, was under review. "We've done some major upgrades on Edwards sites in Leeds and Newcastle-under-Lyme ­ they're both doing in the high £20,000 each week. We've converted some Edwards to Bar Code where Bar Code is a better economic proposition for us," he added. Profit before tax was down 1% at £199m for the year to 30 September while turnover was up 2% at £1.5bn. New-build boom M&B is opening three new showpiece pubs on the south coast of England. It opened a new-build Toby Carvery in Eastbourne six weeks ago and it is taking £35,000 a week. Redundant farm buildings near Worthing have been turned into a Vintage Inn called the Swallow's Return, where takings are more than £30,000 each week. Last week, the MA reported that M&B had bought the Golden Galleon at Cuckmere Haven, between Seaford and Eastbourne, which will be converted into a Vintage Inn in the New Year. Historically, takings at the pub have been around the £24,000-a-week mark. Clarke said: "I was at the Golden Galleon 10 days ago and thought, What a great site'.