Letting on to a secret

After 11 years as tenant of the King Alfred pub in Winchester, Gary Swan tells Noli Dinkovski why he has converted to leasehold

Steeped in history

Nestled away in the Victorian suburb of Hyde, the King Alfred is only a 10-minute walk away from the centre of Winchester. Gary Swan, tenant at the Greene King pub for 11 years, recently made the bold move of taking on a 15-year lease, adding five en-suite letting rooms in the process.

"Winchester, with its history and cathedral, caters for tourists all year round," says Swan. "There's a shortage of accommodation in the city, and we are ideally situated to take advantage of it.

"I generally think people do prefer the idea of staying in pub accommodation instead of a sterile hotel room. They can come out when they like and have a meal and drink in the bar downstairs."

Ready to step up

Having managed pubs in the south Hampshire area for a number of years prior to taking on the King Alfred tenancy, Swan felt he was more than ready to make the step up to leasehold.

"Tenancies are great and they perform a service for people, but I thought I'd explored every avenue with them," he says. "I was ready to commit a bit more and take on a lease that will hopefully give me some return at the end of it."

Swan is proud of the business he has created. "With the high standards we have achieved, I felt it was time to take things further. And I'm a firm believer that if you stand still, you'll die. Especially in this industry as it is today."

Letting-room development

Already in pretty good condition, the only main change to the pub has been new wallpaper and a lick of paint. Creating the letting rooms, however, was a major development that required almost £50,000 of Swan's own money in addition to the £125,000 stumped up for the project by Greene King.

"About £12,000 of my costs were legal fees," says Swan. "The rest went to fixtures and fittings and numerous other works that had to be carried out by myself."

Greene King's contribution meant Swan's annual rent has increased to £25,000. However, no premium was required to take on the lease.

Progress report

Swan's rationale was that as long as the letting rooms would cover the rent increase, he couldn't lose. And so far he hasn't been proved wrong.

"It's early days yet, but the letting rooms are showing really positive results. Of course, you get the added benefit of those extra people eating and drinking in your pub," he says. "The income generated from the rooms is amply covering the rent — we're up to about 60% occupancy already."

As the King Alfred is also in a highly residential area, Swan is finding that many locals find it easier to use the letting rooms to put up visitors rather than at their own homes. Businessmen visiting the area during the week also take many of the rooms. "So the business is being generated from a number of angles," says Swan.

Getting the word out

Swan realised fairly immediately the importance of spreading the word about the letting rooms, but was equally aware that there was no secret formula — only hard work. "I've done some advertising in our local press, but really you need to get the message out more widely," he says. "Through the internet, I have used a company called booking.com. They have been pretty useful — they seek out bookings for you and take a cut."

Another, bolder, step by Swan has been to visit other pubs in the area and let them know that he has rooms available. "I just leave a few cards with them and say if anyone asks them about accommodation could they please direct them my way. I add that there's a meal in it for them if they send me regular people."

Consistency is key

Despite the many changes to the pub trade over the years, Swan says putting customer needs first is the one constant. "Trying to do the best for your customers is the same whether you're running a hotel, a bar, or a restaurant. The principles don't change," he says.

"I think consistency is so important. It's no good doing something and then giving up on it after a week. You've got to be consistent, confident and happy in what you deliver — it's no good running a business that you're not happy with."

Keeping the community

One change to the trade that Swan is keen to avoid is the loss of his core, community-based customers. He says that thanks to the increasing pressures pubs are under from the Government and health lobby, it's becoming harder to retain the kind of atmosphere unique to pubs.

"The regular pub-goers of old are being pushed away," says Swan. "They now prefer to drink cans of beer at home for £16 per case, rather than be forced to pay pub prices. What's more, they can smoke at home too.

"It's a dogfight these days — that's why you've got to be on your game and offer a reason for people to come to the pub."

Freshening up food

According to Swan, one of the King Alfred's strengths is its food offer. Again he says its important to be consistent — customers need to know that what they are going to get for their money will be of the same high standard each time.

"Without becoming too cocky, you should be sure that what you're providing is right," he says. "Keep changing the menu to make it interesting. Our chef is very good at introducing new recipes — we had kangaroo steaks on the other week, for example. He has been with me since before I came to this pub, yet he still has fresh ideas in abundance."

Outdoor area

Another of the pub's assets is its extensive beer garden complete with children's play area. "We have a lovely garden with a small, sheltered area," says Swan. "The children's play area is safe and secure, which means parents can sit nearby, safe in the knowledge that the kids aren't going to wonder off anywhere.

"We are very lucky to have the facility — I also appreciate how hard it must be for pubs that can't cater for children in the same way. It makes a world of difference."

Mistakes

Although the industry has evolved to become much more family-orientated in recent years, Swan argues that it's important to realise you can't be all things to all people. "In the past I've tried to be too complicated with the menu," says Swan. "I've taken on chefs who aren't suitable for the type of food we need to offer — they've come in and tried to change the way we are.

"It's no good lifting a pub into a fine-dining environment, for example, if the clientele that are available to you don't want it.

"I'm still learning every day, and after 11 years at this pub I'm getting the balance just about right. But have I made mistakes along the way? Yes, definitely."

Future freedom

Previously tied on all drink, Swan says it's going to take a while for the benefits of greater freedom to take hold. Still, with a GP of 55% on wet sales and 65% on food, the pub was performing none too badly.

"Moving to leasehold was a big decision for me," says Swan. "Taking on the repairable aspect for a whole building can be quite nerve-wracking, especially if it's an old building. Luckily, I have the benefit of knowing the King Alfred well, and would have known had there been any problems on the premises."

Committing himself to four years before being able to assign the lease was another decision not taken lightly. "One thing that I've only since realised is that even if you assign

the lease after four years and

let's say the people who came in subsequently failed, it can have legal repercussions for you as the original leaseholder. That's a slight concern," says Swan.

"I don't think you go into a lease believing it's going to make you money, I think you go into a lease hoping that it'll give you a chance to build your business because it becomes more yours than a tenancy.||