London Calling

Despite having commercial and social advantages - millions of tourists every year; the UK's largest urban population; daily influx of tens of thousands of workers and so on - the London pub market is not always the picture of rude health many would like to believe. Or indeed paint.

Some operators have suggested that London is no different from any large part of the country which experiences differing economic trends. West End pubs predictably jostle for custom, while backstreet boozers in outlying boroughs struggle or thrive depending on the quality of their offer.

Holding its own

However, one company which stresses it is managing to keep up its momentum in a tough market is listed operator Capital Pub Company (CPC).

Created eight years ago under the auspices of an Enterprise Investment Scheme by Firkin pub chain founder David Bruce and ex-Regent Inns finance director Clive Watson, the group has steadily built up a portfolio of pubs within central and outer London that continues to hold its own.

Watson, installed as chief executive of Capital Pub Company earlier this year following Bruce's decision to step down from the day-to-day operation of the business, says the group wants to double in size over the next three years. Recent acquisitions include the Southern Belle in West London - the former Fulham Greyhound music venue in June - and the Boaters Inn, a Thames-side pub in Kingston, Surrey.

Currently with 24 pubs, he acknowledges, however, there are certain…constraints hindering any significant expansion.

"Obviously we'll not put our foot on the gas too much until the trading environment stabilises," he says. Finding suitable pubs is easier than finding the money to pay for them, it seems.

There's more pressing work to be done, Watson says. "Our focus in the coming months will be to get as much in the way of sales and profits out of the existing estate as possible. We want to evolve our offer, providing better service for customers."

Laudable stuff, if a tad predictable. But CPC doesn't want to follow every crowd. Despite many players moving in such a direction, a headlong rush towards food sales is not on Watson's agenda.

"We don't want to go down the mainly food route. The competition in the casual dining market is intense and we'd prefer to be wet-led and gauge what we need to provide in terms of food offer across each pub."

But the recent appointment of Nick Collins - founder of food outlet Fuzzy's Grub - as the group's new finance director suggests there will yet be emphasis placed here.

"We'll keep tweaking the food offer at some of our pubs," says Watson, "ensuring the offer is as broad as it can be while not being too expensive."

The key to success

He believes that a key to the group's success has been to allow its pub managers to have the freedom to run their pub in a way which benefits the local community.

"We don't have traditional area managers. Some pub managers oversee other pubs in the estate as well. We don't run the pubs from head office, instead we get managers to come up with ideas which can be implemented speedily," he says.

"Putting on certain products to respond to customer needs is at the discretion of the manager in the pub. They know their market better than I do."

Watson acknowledges that costs are an issue, as they are for everyone.

However, he believes cost pressures are peaking, particularly utility bills.

"It's just a case of good housekeeping; a light off here or there, etc," he says, as well as being smart with staffing levels.

Current trading he describes as "resilient". In today's market this is likely to mean either flat or marginally down on the same period last year - no mean achievement as beer sales plummet and consumers draw in their purse strings.

"There is definitely a London factor," says Watson, "but you also have to work harder to keep up current levels of trade."