The Big Interview: Guy Newell, Butcombe Brewery

There are not many managing directors that can say Kylie has performed in one of their pubs. But Butcombe Brewery’s Guy Newell can.

“It was Kylie Minogue and Tinie Tempah at the Ring O’ Bells in Compton Martin, Somerset,” he said. “She had ham, egg and chips, and was lovely apparently.”

That was two years ago at the company’s one tenanted pub, which is run by an executive from music giant EMI.

“We would rather not run tenanted pubs. The reason being — and it may seem like a corny line — that we wouldn’t buy a pub to sell beer. But we would buy a pub if it is a bit special, and we like to manage them as we have control and they live up to the quality,” he said. “But the pub was not doing well and he [the EMI man] put in a good offer.”

Caviar​

Newell boasts a career in the leisure sector spanning five decades. He launched his career in the 1970s running casinos across the globe.

“I started off at the Playboy Club in London. The pay wasn’t very good but who cared? The Playboy bunnies were from all over the world and, of course, there was a complete non-fraternisation policy but what do you do when you finish work at 4am and there is no-one else around,” he laughs.

This was followed by a spell in Greece, and then Iran running casinos for the Shah while eating beluga caviar. “I used to buy a kilo for £8. I was in Harrods the other week and a kilo was £7,000. I don’t eat it much these days.”

He returned to the UK in 1980 and bought a couple of betting shops, which he sold a year later.

“My first wife used to moan that she never saw me. She persuaded me to buy a pub, so we could spend more time together. We bought a lovely old pub called Ye Olde Two Brewers in Shaftesbury, Dorset, which is down the bottom of that cobbled hill in the Hovis advert that everyone thinks is in Yorkshire.

"The pub did brilliantly but unfortunately the marriage didn’t,” he says.

Vision​

This was Newell’s first foray in the pub and beer sector and he was hooked. He proudly believes his was the first pub in Britain to do an extensive range of guest beers. The offer proved so popular that he would get calls from people asking what beers they had on, and they used to turn up in their coachloads.

And it was this one pub that led to the birth of the national wholesaler Beer Seller. He started the business with what he describes as “one girl and one truck — the truck’s long gone but luckily I’ve still got the girl”.

It was 16 years later — in 2000 — that he sold it to Bulmers and the company was by then a national operation, employing 800 staff and with a £200m turnover.

The company expanded rapidly by acquiring 28 other wholesalers across the country. “We had this vision to create a national wholesaler and it was much easier to get a foothold per area by buying existing businesses and then developing them,” he says.

Beer Seller was then snapped up by Scottish & Newcastle, which merged it with its wine and spirit company Waverley to create WaverleyTBS. The failure of the wholesaler WaverleyTBS just over a year ago sent shockwaves through the industry.

Newell puts the failure of the business down to a “lack of focus” and the growth of microbreweries and, in addition, “that big-company mentality in a business with wafer-thin profit margins. If you get it slightly wrong, you are losing money instead of making it”, Newell adds.

Challenges​

When he sold Beer Seller in 2000, Newell was left wondering what to do next. Beer Seller was Butcombe Brewery’s biggest customer, and
he knew the brewery’s owner Simon Whitmore.

Newell explains how he snapped up the brewery from Whitmore, adding: “He was a tough negotiator — a brewery and six freehold pubs is what we bought. We started talking in March and walked away in April because we thought the price was too high.”

There were challenges in taking on the business because part of the deal was that the brewery would have to move from the premises within two years. In addition, it had poor access, no mains gas, and no mains drainage, Newell said.

Despite this, he still wanted the business, saying: “We came back six months later and paid exactly what he asked for.”

That was back in 2003 and Newell has just celebrated 10 years running Butcombe Brewery.

There have been a lot of changes in the business since then. It has moved to a new brewery site, doubled its beer volumes, established a bottled beer venture supplying all the major supermarkets and launched a cider business. In addition, Butcombe Bitter is the third fastest-growing bottled beer in the UK and it picked up a bronze at the Great British Beer Festival this year. 

Newell launched Long Ashton Cider Company eight years ago just as Magners started to take off. He says he is unsure if it was “strategic brilliance or pure luck” but the business certainly benefited from the cider revival.

“When we bought Butcombe it had two products and, coming from a wholesale background, I was thinking ‘all these trucks are going out with one product — Butcombe Bitter’, so I thought this was a nice moment to get another product that could revolutionise the business. That is what the cider has done. It was done to try and fill the trucks with something else.”

Fuddy-duddy​

The pub retail estate has expanded to 19 from the original six and Newell is keen to make acquisitions, but only if they are right for the company.
He still believes that the UK is overpubbed and that there is room in the market for more pubs to shut.

Newell has always been a supporter of managed operations. “People thought I was mad 10 years ago,” he said. “The trouble with tenanted pubs is that there is a temptation to do the minimum investment whereas, if it is a managed pub, you always try and make the maximum.

“When I put a retail hat on I want to give the pub every opportunity and advantage of doing business. We like to think everyone loves Butcombe beers but somewhere out there is an idiot that doesn’t. So we have to cater for them,” he laughs.

And what of the future?

On the brewery side of the business, he believes there is still more room in the market for Butcombe beers. “We are not a BrewDog but we are not a fuddy-duddy regional either. Our aim is to stay relevant and innovative,” he says.

Newell is keen to purchase pubs but is focusing on quality, rather than numbers.

He does admit — with a wry smile — that, even though it’s expensive, “it would be nice to have a flagship in London”.

And for a man who has worked with the Playboy bunnies, run casinos for the Shah and set up a multi-million pound wholesale business, this seems a pretty straightforward challenge to meet.

Key dates​
1966​
Guy Newell leaves Churcher’s College in Petersfield, Hampshire, and embarks on a gap year
1966-1969​
Starts work as a croupier at the Golden Nugget Casino in London
1970-1971​
Becomes a pit boss [supervisor in charge of gaming tables] at the Playboy Club in central London
1971-1973​
Starts work as a pit boss at Parnassus Casino in Athens
1973-1978​
Becomes general manager at the Ramsar Hotel and Casino in Iran
1978-1980​
Owner of Brent Racing (the company had two betting shops in north London)
1980-1984​
Becomes owner of Ye Olde Two Brewers in Shaftesbury, Dorset
1984-2000​
Is managing director of the Beer Seller drinks wholesaler. The business is sold to Bulmers in 2000.
2003-present​
Becomes managing director and shareholder of Butcombe Brewery