What does a pubco mean by 'reasonable' and 'fair'?

‘Pubco speak’ is a strange dialect; one seemingly riddled with ambiguous terminology.

Perhaps we shouldn’t be too surprised by this fact. After all, certain pubcos are staunch advocates of ambiguity; particularly those blessed with an insatiable desire to try every means possible to extract rather more than they’re entitled to.

Definitive explanations invariably eliminate ambiguity by inviting the spectre of transparency to the table; not necessarily a good thing for those seeking to interpret in ways that suit a particular agenda.      

Take ‘reasonably efficient operator’ and ‘fair maintainable trade’ for example.

Comforting?

I find the term ‘reasonable’ particularly comforting. It doesn’t suggest a genius destined to set the world alight; merely someone deemed solid and reliable.  

The notion of being ‘fair’ offers similar assurances; intimating the level of performance expected is in keeping with the status of solidly reliable.

Knowing that everything is ‘reasonable’ and ‘fair’ must be immensely reassuring for those contemplating a career in the trade. I think most of us feel confident we could aspire to being reasonable at something. After all, it doesn’t sound too daunting, does it?

I don’t know about you, but such language puts my mind at rest. It provides assurances that prospective licensees are committing to a partnership with an ethical pubco, not some blood sucking leech intent on bleeding them dry.    

What’s abundantly clear is that much of the vocabulary contained within ‘pubco speak’ has been carefully thought through. The concepts of ‘reasonable’ and ‘fair’ for example are very much intertwined; leading many of us to understandably conclude that a run of the mill operator will be expected to generate profits that reflect that status.  

The problem is that not everything is quite as it seems.

Problems inevitably occur when the assessment of what a reasonably efficient operator can achieve is elevated far beyond what is practically achievable.   

Unrealistic expectations​

I’m a keen walker – given my current level of fitness I’d class myself as being in pretty good shape for a 55 year old. I eat healthily, exercise regularly and class myself as being reasonably fit.

So does this enable me to run a 6 minute mile, or complete a marathon in less than 3 hours?  

Not very likely; but a brisk walk up the Brecon Beacons on a bright summer’s day? I reckon I could manage that.

Of course my expectation of what a ‘reasonably fit’ person can achieve is unlikely to gel with a pubco’s estimate of my true potential. I suspect walking briskly up a mountain range wouldn’t be enough to satisfy their notoriously lofty aspirations.

‘You can do a lot better than that Bob’ I hear them say as they hand me a 75 kilo rucksack to strap to my back. ‘We want you to run 24 miles; culminating in the ascent of Pen Y Fan. We’ll give you 3 hours.’

Inevitably, I’d voice some reservations at what seems on the face of it, a pretty tall order. The pubco would of course offer reassurances that this is what’s expected of a reasonably fit person.  

Who am I to question, what on the face of it at least, appears a highly optimistic ask?

After all, these guys have organised many recruitment drives in the past and they appear to know what they’re talking about. I just need to put my reservations to one side and adopt a positive mind-set!

So off I go, determined to give it my best shot. Two miles into the run the weather takes a turn for the worst. Temperatures begin to plummet and the first flakes of snow begin to fall.

Conditions continue to deteriorate as the terrain steepens. As we encounter a ferocious blizzard I reassure myself that the organisers will allow us additional time to finish. After all, no-one in their right minds would expect us to complete the run in the original time, would they?

Unfortunately, that’s exactly what certain pubcos expect of their licensees. Of course, by the time they’re made aware of this rather unpalatable fact it’s invariably too late.  

Now of course it could be argued that my failure to complete the run within the designated time labels me a failure.

I, on the other hand, would counter that the bar was set far too high and that there was never any realistic chance of me meeting the high levels of expectation placed upon me.

One-sided partnership​

Licensees frequently find themselves at the mercy of wildly optimistic interpretations that are invariably devised to ensure that there is only one beneficiary in this very one-sided partnership.   

The subjectivity surrounding the definition of what constitutes a ‘reasonably efficient operator’ allows pubcos to inflate trading projections far beyond what is realistically possible. This in turn allows them to justify those exorbitant demands under the banner of fairness.  

When licensees fail to meet these unattainable expectations they’re labelled failures.

When external elements conspire to reduce footfall, pubcos are increasingly reluctant to make allowances for the inevitable impact this will have on turnover.  

Why should they I hear you say?

Well, it’s interesting that the BBPA never miss an opportunity to try and convince government that numerous factors have conspired to drive down sales in pubs. (Needless to say, pubcos have always gone out of their way to absolve themselves of any blame).

Whilst there is little doubt the smoking ban, changing lifestyles and a prolonged recession have all taken their toll on pubs, pubcos don’t appear to take such factors into account when it comes to assessing fair maintainable trade and the rents upon which such calculations are supposedly based.

In fact in many cases it’s the exact opposite. Many licensees complain falling revenues have done nothing to quell the pubco’s insatiable appetite for rental increases.

Perched on their debt mountains they think only of taking more. Ambiguity is undoubtedly a potent weapon in helping to bring this about; allowing demands to be inflated yet absolving them of all blame when things go pear-shaped.

It’s not that the bar was raised too high. Oh no. It’s simply a case of the licensee not being up to the job.

Of course, once this fact is established then there’s no need to consider lowering the bar a couple of notches.  After all, why should the pubco take a bit less because a tenant failed to meet their perfectly reasonable demands?

The fact of the matter is that pubco expectations are so far out of sync with the current market that the fate of many licensees is preordained before they even set foot in the pub.

For meaningful change to come about, pubcos need to acknowledge licensees are mere mortals. They are not messianic figures blessed with the ability to walk on water, raise the dead and feed five thousand people with five loaves of bread and a couple of fish.

Once that day arrives, perhaps the terms ‘reasonable’ and ‘fair’ will begin to reflect the realities of the real world, not merely the short sightedness and greed of pubcos.

Robert Sayles tweets @bobsayles and is a supporter of the #FairDealForYourLocal campaign​