Pub boss' 'bloody nightmare' electricity bills
"It is the only time in my life I have celebrated an 18% rise in costs." That is the stunning admission by Thorley Taverns boss Phil Thorley over the re-negotiation of an electricity contract for his 34-site estate.
Utility costs are fast becoming the second biggest challenge facing the industry after the smoking ban and Thorley said renegotiating his deal, which lapsed at the end of December, was a "bloody nightmare".
"Initially brokers came back with a best case uplift of 78% and an 85% uplift at worst," said Thorley.
There would be a riot if I stuck 78% on a pint. I would have no customers left. Phil Thorley
"There would be a riot if I stuck 78% on a pint. I would have no customers left."
Thorley and his team phoned other friendly multiple operators to find out who they were using and by-passed its broker to negotiate direct with suppliers.
"It took us six weeks to find a good deal," said Thorley. "Even-tually we signed with Powergen on a one-year deal. We were not in a strong position because we were out of contract and with 34 sites we are a pimple on the backside of the world. Utilities is a minefield and you have to tread extremely carefully."
Overall, electricity costs are expected to rise £36,000 on the £200,000 bill last year.
Thorley is now preparing himself for a similar process in May as he seeks to find the best deal from gas suppliers.
The Association of Licensed Multiple Retailers is holding a business briefing for members on reducing energy costs on 10 May at the Commonwealth club in London.
To book a place phone 0208 579 7579 or visit www.almr.org.uk .
A free guide on reducing energy costs is available to download from www.consideratehoteliers.com .
