Punch: more concessions on new leases
Punch Taverns has offered further concessions to new licensees to tempt them to sign up to three new leases it's offering.
The company launches the leases officially in its south-east region next week but first unveiled them in June.
Punch is offering a shorter five-year tenancy but also two types of ten-year lease offering free-of-tie prices in return for higher rents but bigger discounts when licensees sell volume in excess of FMT barrelage.
Punch has responded to criticism that the new leases scrap rent reviews but impose RPI rent increases, amounting to upward only rent reviews by another route.
It is now saying that licenses can request a rent review, but Punch can't - and that rent will increase by CPI (Consumer Prixe Index) annually rather than RPI (Retail Price Index); CPI is normally lower than RPI (Retail Price Index).
"CPI tends to be lower and less volatile," said leased division boss Roger Whiteside.
The company has also firmed up the detail of its offer to allow licensees on the ten-year leases to stock a free-of-tie ale - hosts can stock one free-of-ale ale from its Local Brewers' List for every tied cask ale they stock.
Punch has now labeled the two ten-year leases, Punch Buying Club Option One and Option Two to coincide with the launch of its on-line buying club - new sign-ups to the leases will have do their product ordering on-line.
The aim is to enable licensees to save "time and money" by ordering a wide range of products through the club.
The club is launching by offering drinks products and will add food in November before moving on to insurance, utilities and cleaning materials.
Punch hopes to expand the scope of the buying club to include many other items over time.
Whiteside said: "These are the final two pieces of the seven piece jigsaw by which we hope to become the trade's 'most trusted and best value' leased company.
"We're trying to create a club of enthusiasts for pubs.
"Licensees will be able to choose the level of risk they want to operate under, how much rent they want to pay and how much discounts they can obtain."
All Punch licensees will eventually be offered the chance to convert to the new leases at their next rent review.
Whiteside also said that Punch would become "more selective" about the type of operator it wanted for certain pubs.
"Some pubs won't be available on a five-year tenancy - we wouldn't want to let them to a lifestyle operator because there's a risk of the of pubs under-performing."
