Bringing quality to the community

This must be what Kevin Georgel means by a 'proper pub'. The lunch menu consists of a basket of baguettes wrapped in clingfilm and a list of pies. All good stuff, though, as is the beer — a choice from 12 hand-pumps. And the Nag's Head does very well.

A small to middling-sized pub on a side street off one of Reading's traffic-clogged main roads, it sees regular visits from Georgel. He may be the managing director of Admiral Taverns, the company that owns the pub, but the relationship with the barstaff seems warm and informal.

Georgel is coming to the end of his first year at Admiral, the latest step in a career that someone once described as a 'meteoric rise' — "though I don't know whether that's good or bad," he says.

Certainly, there were a few raised eyebrows when he ended seven years at Punch Taverns to take on a business that has a reputation for accumulating bottom-end pubs.

"There were people who understood my decision and saw what I was doing, and there were people who thought I was mad. There was no middle ground," he says. "I had done a lot of due diligence on Admiral and found that the perception that it's a down-market company was off the reality. Yes, it's a community wet-led estate, but it has some very good pubs. We're sitting in one now.

"I could see the potential. What attracted me was the focus on organic growth — it was doing what we were trying to do at Punch."

Georgel was a key figure in the culture change at Punch that's seen it move from a tenanted and leased company geared for rapid growth to one that's now paying attention to its organic performance.

What he identified at Admiral was "a sharp focus on the realities of the business", the realities, that is, of operating 'proper pubs'.

"We have every imaginable type of pub at Admiral, but the heart of the company is the community pub — proper pubs, as I call them."

Georgel says he joined the industry because he's "passionate about pubs". And the pub that stokes that passion is most definitely the unfashionable community wet-led boozer, and he wants Admiral to be its leading force.

"When people say the wet-led community pub is dead it annoys the hell out of me! It's nonsense. This pub will be here in 10 years time. There will be fewer pubs like it, but they will exist and they will be better.

"Community pubs rely on a habitual trade, and a lot of people aren't out of the habit. I've seen it with my own eyes. If you talk to them, they've not changed. We're talking about people for whom a visit to the pub is a fundamental part of life. That makes it a stable model, less volatile than destination pubs. The best community pubs are viable businesses."

Reducing the estate​

Either side of Georgel's arrival Admiral has nevertheless been selling off large numbers of pubs. An estate that once topped 2,000 is now down to 1,350, which he believes is "heading towards the right number".

"We bought 189 pubs from Piccadilly Licensed Properties before Christmas and they've been a huge success," he says. "We disposed of 36 and transformed the performance of the rest. We seem to have the ability to run pubs that others can't. I think that comes down to addressing the long-term fundamentals of community pubs, to creating environments where people want to socialise.

"I wouldn't rule out further acquisitions," he adds, which must mean more disposals, but for Georgel that's a difficult decision. It's a dilemma and an opportunity. What I've learned is you write a pub off at your peril — if you find the right operator the chances are it'll work."

And it's also a question of being able to motivate that operator in a tough market, getting them to do the right things to keep customers coming back.

"You have to understand these pubs as something more than commercially successful businesses, their licensees are driven by more than profits. A lot of our licensees are from the local area to the pub they're in. They talk a lot about providing a community service, being respected, and they are really passionate about doing that. It's quite humbling.

"There's a balance to be struck, of course. You can't disregard viability, we can't lose sight of the money. But as long as they're making enough that's absolutely fine."

Business philosophy​

Georgel has not taken Admiral down the road of agreement innovation, though a six-month try-before-you-buy deal is proving popular and there is a lot of flexibility within the existing tenancy agreements — 7% of the estate, for instance, is free of tie.

His ethos rests rather more on three things: the calibre of his team, the simplicity of the business and the delegation of authority to business development managers (BDMs).

"It's always been frustrating for licensees that BDMs aren't empowered to make decisions," he says.

"To respond to the market BDMs have to have a flexible approach, the ability to say there's nothing we can't do, the willingness to listen to any argument."

BDMs, so often the weak link in the tenanted pubco model, are central to Georgel's strategy. He's head-hunted some of the best to add to a team he already had a high regard for and he has redrawn their role.

They not only possess a high level of skills, more like a managed house area manager's, but they are charged with having a complete focus on their relationship with tenants.

"They must be able to motivate and to lead the licensee to make changes to the business," he maintains. "It can be a big or a small change, from watering the hanging baskets to something huge."

To help achieve that Admiral has relieved BDMs of bureaucracy and red tape, so they can call on tenants more frequently.

"They still have 40-plus pubs each, but they visit them more regularly than most BDMs who might be in trade only two or three days a week. Ours are in trade five days a week and some weekends and evenings.

"The relationship they have with tenants is different, too," adds Georgel. "There is a big element of trust involved. The ability of our BDMs to influence licensees is very, very high. More than half of them have been licensees and that's a huge factor. They've got credibility.

"And to get the best out of BDMs we not only empower them but enable them."

Strategy​

That means equipping them with a toolbox that includes a relevant catering solution called Famous Five, providing simple pub dishes that retail at just £2.99 a piece.

"It's not about turning it into a food pub, but increasing dwell time and take. One pub we've used it in made £7,000 a year profit out of the food — but an extra £13,000 from drink."

Licensees are also offered training, short and practical modules run locally that Georgel wants to be accredited by the BII (British Institute of Innkeeping). They cover such subjects as finances, commercial skills, marketing and merchandising and, importantly, cask ale, a point of difference for many Admiral pubs. The company is now a corporate member of Cask Marque and has opened the Society of Independent Brewers (SIBA) direct delivery scheme to all licensees.

Georgel's arrival brought investment in the fabric of the pubs, too.

"A big problem was that there hadn't been a lot of capital expenditure on the pubs in two or three years, but that's changed. We have a £5m investment programme — and the focus is on externals.

"For a lot of our pubs the internal experience exceeds the external

perception and we're trying to put that right."

Perhaps that goes for Admiral Taverns as a whole.

MY KIND OF PUB​

"This one, the Nag's Head, would be one. It's a real pub frequented by real people.

"Another would be the Cadgwith Cove Inn, near Helston, in Cornwall. It's populated by villagers, tourists and fishermen singing sea shanties — that's my south-west roots coming out.

"And another one of ours, the Laburnum Hotel in Bootle, Merseyside. It's immaculate, the beer is fantastic and it's extremely well run by Marie Freeman, a licensee who has the respect of a community she's from."

KEY DATES​