Perhaps we’ll never know exactly what dramas unfolded in the JD Wetherspoon (JDW) boardroom a year ago that led to the abrupt departure of chief operating officer Paul Harbottle and finance director Keith Down.
Harbottle, for his part, is playing a straight bat that Geoffrey Boycott would be proud of. “You come to a point in a career when it’s time for a change, and that’s what happened at Wetherspoon,” he shrugs.
Certainly there’s no trace of bitterness. Quite the opposite, in fact, as he talks admiringly of the JDW culture and the “principles and passion” he took from it to the work he’s now doing as chief executive of Atmosphere Bars & Clubs.
“I’m not sticking two fingers up and saying ‘I’m going to do it my way’,” he says.
Atmosphere has yet to become a familiar name in the industry, but that’s a shortfall Harbottle is addressing, and if everything goes to plan over the next couple of years it’s likely to become a serious force to contend with.
The company was formed early last year when Sun Capital Partners bought 29 leasehold sites out of administration from 3D Entertainment Group, a spin-off of Luminar Leisure and best known for the Chicago Rock Cafe brand.
Sun Capital Partners already owned some 3,000 bars and restaurants in the United States — as well as an eccentric mix of companies in the UK that includes Hewden Plant Hire, Lee Cooper jeans and Sharps Bedrooms.
“It wanted to establish itself in the UK bars sector and it specialises in buying distressed businesses, taking away their debt and letting them grow,” explains Harbottle. “So we have a business without debt, which is fantastic.
“There’s money to acquire too. It would like us to open two before Christmas and six next year, then two a month during 2013, so in two years we’ll have 60.
“That could be done by buying another group.”
As he says, “Sun is a company with ambitions”, and that’s what attracted him to the job.
“When I left Wetherspoon at the end of last October I attracted a level of interest,” he says, with the merest hint of understatement.
“I spent November meeting people and I was as busy as I had been when I was working. I quickly judged, though, who was interested in getting information and who was interested in me.”
He was offered three posts, but Atmosphere won out and he joined in March.
“It was an opportunity to be a chief executive, which was quite important to me if I was going to be in a smaller business than Wetherspoon — and, basically, most of them are in this industry.
“And it would have to be a business that I would have the chance to grow.”
Challenges
There are three branches to Atmosphere — the Chicago’s bars, eight large clubs and the new Modello Bar & Kitchen, the third of which has just opened in Bedford following a £1m refurbishment.
Lunchtime at the Watford Modello, a former Chicago Rock Cafe, is a pleasant surprise. There’s none of the harshness you expect from a late-night bar specialist, but instead a relaxing atmosphere and a gentle buzz from groups of people having a bite to eat. There are even three cask-beer pumps.
“A premium bar with a Mediterranean feel,” is how Harbottle describes it. “I want it to develop into something that attracts people who want casual dining and premium drinks, the kind of place to meet friends, enjoy a drink and a snack and relax.
“It seems to be working. At the moment 30% of the take is food, although we’d like to move that closer to 40%.”
He hopes that Modello will bring a steady all-day trade, and he recognises that the other businesses, too, have got to broaden their appeal beyond the full-on party venue.
“Chicago stopped evolving in the 1990s and we need to bring it to where it should be without losing the positives — its 60% female mix and reputation for cheesy music. There is nothing wrong with that in the right place at the right time, it’s just unpretentious fun.
“So that’s obviously key to the brand, but we’ll add a food offer and bring back the American twist that’s been lost.”
The biggest challenge is the club side of the business. While they are well invested and most are doing all right, Harbottle is aware improvements must be made.
“The late-night market has changed. The difference between pubs and bars has been blurred and it means customers are more savvy. There’s been greed and naivety from the sector in the past, asking them to pay on the door and then serving them unbranded drinks.”
He’s already addressed that by putting brand leaders on the bars and taking tighter control over the music that’s played, with the appointment of a DJ co-ordinator.
“We’ve seen an increase in door income, which could mean customers are satisfied they’re getting more for it. But it’s a very volatile market. It either relies on students or you’ve got to be at the top of your game all the time — people are always looking for something that’s shiny and new.
“And if you don’t have that broader appeal, it becomes tricky.”
One thing Harbottle seems to have on his side is the staff.
“The company had gone through a pre-pack administration before I arrived and you would expect people to be demoralised. Yet the people in the venues, delivering the operation, were fantastic, and that’s made it easier to make changes.”
Not least because Harbottle has ensured those people have been part of the decision-making. It’s something he learned well from his previous employer.
“Wetherspoon has a conviction that ideas will come from the bottom of the organisation. It takes a while to get there, though. You have to ask people three or four times before you get the right solution. Before that they’re saying what they think you want to hear.
“So it’s slow and frustrating. But once you’ve decided what to do it means you have the buy-in and the implementation is almost instant.
“There’s no substitute for seeing the business from the front line,” he adds. “It was drilled into us at Wetherspoon that the business happens in the pub, and that’s absolutely true.
“Every venue, every pub is a micro-economy, and the people behind the bar have an empathy with what customers want.
“Your team will always understand a problem better than you, so you have to engage with them if you want to find solutions.”
Staff in the bars, for instance, had a say in the new drinks range that was introduced across the group in May, bringing in the likes of Magners, Budweiser and WKD.
“They got the products they wanted,” says Harbottle. “We were selling alternatives to the leading brands before, although the difference was only a few pence.”
Another advantage the Atmosphere chief believes he has over the competition is patience. “We take a long-term view. Other operators in this market expect something new to work after a fortnight. We say you’ve got to give it three months.
“It will be two to three years before we come out of this downturn properly and we can look forward to success after that,” he goes on.
“Until then we’ve got to earn the trust of customers by being consistent and good.
“You don’t mess about with their loyalty, you don’t rip them off and you do give them something back.
“We want people to come back to us because they have had a good dance or they’ve had great customer service, not just because we sell cheap drinks.”
My kind of pub
“My kind of pub is a village pub where you can take the family.
“Somewhere you can sit down and drink a great pint of beer without feeling under any kind of pressure at all.
“I grew up near Bristol, and the Anchor Inn at Oldbury-on-Severn, in Gloucestershire, really does that for me.”
Key dates
1991 Paul Harbottle graduates from Reading University with a degree in chemistry with soil science, and joins National Freight Consortium, now DHL
1995 Becomes operations director at fruit importer Empire World Trade
1999 Moves to Golden West Foods, supplying McDonald’s with all its buns
2003 Joins JD Wetherspoon (JDW) as head of distribution
2006 Promoted to commercial director
2007 Appointed chief operating officer
2010 Atmosphere Bars & Clubs formed with acquisition of 29 sites from 3D Entertainment Group. Harbottle leaves JDW
2011 Harbottle takes over as Atmosphere chief executive, replacing David Crabtree