Winning back trust in the tenanted trade

It was an Enterprise licensee who asked one of the most pertinent questions at our Tenanted Pub Company Summit last week. Gerry Price, an Enterprise lessee, has run pubs for 30 years and he asked a panel of trade luminaries how trust would be restored in the relationship between pubcos and their tenants.

It's a question that cuts to the heart of the tension between tenants and the larger pubcos in recent years. And it's a sign of a growing maturity within the tenanted sector that the pubco bosses on our discussion panel were able to answer in a way that did them credit.

Punch Taverns boss Roger Whiteside said earning the full trust of its licensees was a process that would take years. He added: "It will take years of consistent behaviour, of behaving in ways that engender trust, demonstrated from the very top of the business right the way through all the layers of management so it reaches those at the coalface."

Whiteside said he believed the trust of tenants would be earned in the years to come. "But we're certainly not there now," he said. "If we surveyed our licensees I wouldn't be happy with the result because we've still to earn that trust."

Industry expert Phil Dixon praised Punch for "making a real effort" in the relationship between itself and licensees. He cited its roadshows as an example of one area where it was attempting to engage with its retailers and create trust. But Dixon criticised Enterprise Inns for not developing a deeper relationship of trust with licensees. He argued that the company missed a trick when it bought Unique. He added: "Enterprise has to get closer to its customers. It can be done — Punch has made great strides in that area and I think Enterprise needs to learn a lesson."

Enterprise Inns divisional director Nick Light, a former Unique executive, acknowledged the problem. "It's clear the relationship varies enormously. We have done a survey recently where 83% of our licensees rate the relationship as fair, good or excellent. While that's encouraging, it's the 17% that's the worry.

"We've got to make sure that ratio gets smaller and smaller. I take the point Phil made about Unique Pub Company — I worked there.

"We've re-introduced retailer boards in the past 12 months. We held them across the country and now hold mini roadshows in the regions. Some of the comments Phil's made are not without justification, but I do think progress is being made in this area."

As it happens, a live example of distrust popped into my inbox over the weekend. An Enterprise licensee challenged boss Ted Tuppen's claim that anyone taking around £6,400 a week should earn £35,000 per annum (without the live-in benefit). The Enterprise licensee takes this amount — and his profit is around a third of this figure.

He noted: "It's obviously very difficult for any individual tenant to allow himself to become a public example of real figures as the pubco will, without doubt, make life extremely difficult afterwards."

There's your challenge, fellas.