The smoking ban: rising to the challenge

A year on and the smoking ban in England, like Scotland and Wales, is still testing the country's pubs to the limit. Some licensees have strongly condemned the ban for effectively driving away customers, while others say they have benefited from the cleaner environment. Pubcos have spent millions on facilities for smoking customers although, as many will attest, quantifying the returns on such a specific investment is difficult.

We asked a number of pubcos to reveal the ban's impact on their businesses, how they responded to the challenges and, given half a chance, whether they'd reverse it. Here are some of their responses.

1. What's been the ban's impact on your pubs?

Andrew Andrea (AA),operations director, Marston's Pub Company​: "To isolate the impact of the ban is difficult. But there's no question it has contributed to the trends in the past year. We've seen reduced wet and AWP income streams, mitigated by increased income from food and rooms, factors that have helped generate some growth, albeit slower than prior to the ban. There's also little evidence to suggest that historical 'pub rejecters' have come back to pubs in a smoke- free environment."

Simon Townsend (ST), chief operating officer, Enterprise Inns​: "It is impossible to disaggregate the financial impact (positive or negative) from the welter of other influences the pub industry is currently facing. That said, pubs with well-thought-through outdoor smoking facilities and attractive retail propositions appear to be better able to outperform their competitors."

Chris Hopkins (CH), managing director, Hydes Brewery​: "It's had a severe impact in some wet-only pubs where smoking facilities could not be added. These have shown turnover declines of up to 20 per cent. At the other end of the spectrum, some sites have benefited - or at least maintained trade levels - as a result of developing external facilities or due to their heavy food bias."

Nigel Turpin (NT), corporate affairs director, Punch Taverns​: "The most positive results have been seen by licensees who've adapted their offer to focus more on the customer and those who continually increase their retail standards. Outlets with no smoking solution have been worst affected and we actively continue to encourage these licensees to diversify their offer and take on board the best practice of others."

Paul Wells (PW), chief executive, Charles Wells​: "The long-term implication is hard to define. By their nature, many of the pubs attracting a high percentage of smokers are also those most badly hit by the current spending curb. So there isn't any definite evidence to demonstrate financial impact as any one of a number of factors could be at work."

Kathryn Holland (KH), corporate communications director, Mitchells & Butlers​: "We have continued to evolve our formats to take advantage of the wider consumer appeal of food-led pubs post-smoking ban. The improved quality, choice and value of our food offers has broadened our customer base, attracting new users and allowing us to boost associated, higher-margin drinks sales."

Samantha Cox (SC), brand manager, Scottish & Newcastle Pub Enterprises​: "It is very difficult to measure the effects of the smoking ban in isolation. Some pubs have benefited while others have suffered a downturn in trade as a result of the smoke-free legislation. Good food houses have seen an uplift, but some landlocked community pubs have performed less well."

Jonathan Neame (JN), chief executive, Shepherd Neame​: "It is very difficult to break down the impact of the credit crisis, smoking ban, etc. In any difficult times some pubs do well, others suffer. The general trend on sales is well documented, namely lager sales under pressure, ale and food satisfactory."

2. How has the ban changed the way your pubs trade?

AA​: "Where appropriate, if there is an opportunity to drive income streams harder from rooms and food, we have exploited those opportunities. Plus, the requirement to maintain a pub to a high level of quality is now more relevant than ever. Quite simply, if pub standards are poor, trade will suffer."

ST​: "Substantially, in addition to a significant population of smoking customers to be accommodated, there have been opportunities to attract new customers to a smoke-free pub environment. This has required every pub business to review the offer it makes to consumers and adapt accordingly."

CH​: "It depends on the type of pub and its ability to respond. Those with good external areas have exploited them and adapted to having more customers outside. New facilities now need to be offered externally, and on occasions it can be challenging to create an atmosphere inside the premises. For others, the challenges are about attracting new customers and cutting costs to respond to a declining core trade."

NT​: "Pubs that have responded well to the smoking ban have changed their offer and introduced or increased their focus on food and standards. It's about the attitude of the individual licensee, the offer and the retail standards in place."

PW​: "The ban provided an opportunity for a strategic review of each pub's business plans. We've seen everything from no change to a complete repositioning of the business. Licensees can't sit back and wait for business to happen - they have to view their pub as a retail outlet and diversify to accommodate the changing environment and changing consumer profile."

KH​: "Our view has been that pubs with a strong food offer and high standards of amenity and service will benefit from the smoking ban. There is also a real opportunity to accelerate the growth of wine, soft drinks and coffee sales as customers visit the pub for increasingly different occasions."

SC​: "Community-focused pubs have benefited from putting on extra entertainment, running pool and darts teams, and quiz nights. More of our pubs have offered food for the first time. We have developed back-bar food packages which have enabled pubs with no previous food offer to provide customers with bar snacks."

JN​: "Trade has become more weekend biased and more feelgood-factor-reliant, for example, on the weather. Good local food offers have done well, good ale offers have done well. There is also evidence of an increase in live entertainment."

3. When will trading get back to normal?

AA​: "Looking at Scotland and Ireland, after the first year trade starts to level off, albeit at a new re-based level. How- ever, there are many other external factors affecting the on-trade which will affect the 'normality' of trade."

ST​: "There are many contributory factors affecting current trading. It would be impossible to say how any one, or any combination, of these, will change over coming months."

CH​: "We don't expect trading to get back to normal. Circumstances have been changed fundamentally by the ban. We are hopeful there will be no further year-on-year decline in the second year, although the economic downturn will make that very hard to assess."

PW​: " 'Normal' is whatever current trading conditions are. We're always working with our retailers to achieve year-on-year growth and react to the many external influences exerted on our industry, of which the smoking legislation was just one."

KH​: "Our experience of the second year of the smoking ban in Scotland has given some support to our view that the bulk of the negative effects are concentrated into the first year of a ban."

SC​: "Where customers have been lost we anticipate they will not return immediately but will do so over time. Evidence from Ireland and Scotland suggests trading patterns