Since buying the pub – which is also our home – we have seen the value quadruple and then fall back by 50%. Today’s open market, free-of-tie valuation does not even double the amount paid to Bass 32 years ago. Much smaller cottages in our village sell for more than the pub would realise as a freehold property.
Over the years, I have pondered why anybody would stump up the punitive rents demanded by pubcos when pubs could be purchased for far less than a domestic house of similar size.
The answer, of course, is our lending institutions.
In 1990, there was no trouble arranging a commercial loan with a pub as security. In the late ’90s, banks were thrusting cash at us. I had an unsolicited communication from our bankers offering funds of over £100,000 for “business developments”.
Today, loans cannot easily, if at all, be obtained for the purchase of licensed premises.
Kitchen installed
In 1990, our pub had no kitchen and, in common with most pubs, had never served food other than in a bag of crisps with a blue twist of salt. We saw an opportunity and, during renovations, we linked the main building to a Victorian coach house and installed a kitchen.
This also meant that for the first time a visit to the gents’ loo did not entail putting on a raincoat on wet days.
In the mid ’80s, we also converted a large room over our new kitchen into a 40-cover dining room or “bistro” as we called it.
Every Friday and Saturday evening we were fully booked, all tables reserved throughout the bar and the bistro.
Then in 2001, foot and mouth disease struck with disastrous consequences for tourism and catering in our rural area. Holidaymakers who traditionally visited us chose – for the first time for many of them – to go abroad. And many of them found they quite liked it.
Two of our chefs decided to leave us at that time and we closed our upstairs bistro to concentrate on keeping the pub busy. Some establishments did not survive.
While in no way comparing the foot and mouth outbreak with Covid-19 for severity or duration, it made quite an impact and no financial assistance was available.
And then Covid-19 happened. The financial assistance given by Government meant we could keep on six of our staff and start a takeaway meals service, which built up steadily and included a list of volunteers drivers who delivered meals to the housebound.
During the lockdown we decided that when reopening we would radically change the model of the business, carry on with the kitchen, but only producing takeaway meals and convert the pub into a socialising environment, with smaller tables and comfy chairs.
Prior to Covid-19, our being fully booked each weekend prevented locals from enjoying a casual drink in the pub – and three large houses in the village each catering for up to 20 guests are now potential drinking customers.
So we embarked upon our new course, just drinks served in the pub, and we expected – and received – some complaints from a few of the regular diners. But we received support from many more locals who had never before set foot in the pub, and the takeaway kitchen continues to be busy enough to keep on the staff who had been with us during the lockdown.
GP not percentages
After 32 years, we have returned the pub to what it was for 500 years. The pub is also busy partly because we have kept the prices to our locals down, and we focus on gross profit amount generated rather than percentage.
So now we endure the third and potentially the most threatening tribulation – energy costs. The consequence of the unbridled increases will be lethal for many pubs.
Around us there are now two empty pubs, and a third closure has been notified.
Our new gas and electricity rates imposed from last November demand an increase of more than 500%, the meagre Government subsidy does not even scratch the surface and the situation is not sustainable.
Last week, the Government announced a cap on fees universities can charge and yet they make no move to rein in the unjustifiable outrageous increases demanded by the utility companies. Germany has capped prices and is considering passing legislation to force energy companies to make refunds for recent price hikes.
During Covid-19, we received financial support. It is now imperative that decisive action is taken by Government to ensure businesses weather this storm. And yet we are informed that the paltry support available now will be halved soon. The Government seem unaware, or uncaring, of the consequences of their lack of intervention.
Their inertia is unbelievable.
Their apathy is astonishing.
The result for many businesses is predictable.
We love running our pub and the service we offer the community but, for the first time in more than 30 years, we are uncertain about our future.
