What were once largely transactional relationships involving filling in order forms, haggling over payment terms and waiting for the van to deliver, are now often more two-way affairs, nurtured by both parties for mutual benefit.
The top pubs and pubcos are seeking out suppliers that will go the extra mile to add value to both sides’ businesses.
“I wouldn’t say all pub companies take the same approach but that’s definitely ours,” says Richard Ferrier, chief executive of Heartwood Inns, a double winner at this year’s Publican Awards.
“It has to be a partnership. You can’t do this on your own. We really respect and enjoy our working relationships with our suppliers.”
The trick, says Ferrier, is to find suppliers that share your values, which for Heartwood is led by a focus on seasonality and sustainability in food.
This informs recipes and pricing through the sourcing of menu items, and customer service through supplier input into staff training and product advocacy.
A prime example is its work with Aubrey Allen, the royal-warranted butcher.
“Quality and ethics flow through everything it does,” Ferrier says, “from sourcing the right breeds, to proper animal welfare and then the way the meat is prepared.
“All of that gives us the confidence to talk about sustainability and the things we care about in food.
“It goes way deeper than just a transactional thing; it’s very involved. We develop products together and they are full involved in our menu development process. They bring ideas to us that we then work up with them.
“We try to maintain what we call carcass balance, taking one piece of an animal for one menu, and another piece for another. We’re working together to make sure there is minimal wastage.”
It has to be a partnership. You can’t do this on your own
But it’s not just about window-dressing or even just doing the right thing for the sake of it. The partnership pays off on the bottom line, says Ferrier.
“There have been a number of cost challenges with food inflation running in the high teens for parts of last year. We wanted to be seen as good value by our guests and anything we could do to minimise costs could be passed on to them in better prices.
“Pork belly went through the roof, primarily driven by the export market and labour costs. Aubrey Allen brought forward a particular piece of the shoulder that we worked together on and called it pork rib-eye.
“We worked with them to smoke the meat, taking a relatively cheap cut of meat and adding value to it through the cooking process. It’s a reasonable price on the menu and has become our best-selling item.
“As a supplier, Aubrey Allen is as integrated as it can be. We talk to them daily and that partnership approach ultimately benefits our guests and keeps bums on seats.”
Aubrey Allen gets publicity from a name-check on menus, but there’s also a benefit for Heartwood from that in the kudos of being linked to a supplier to leading Michelin-star restaurants.
Close bonds with suppliers also help enthuse Heartwood staff about the products they’re serving. Ferrier says its work with Ellis Wines is a good example.
“It’s got a group of exceptionally strong trainers that go out and visit our teams,” he says. “They hold wine training on-site to help our teams understand the wines we list. We’ve just become accredited with the Wine & Spirit Education Trust and Ellis is just about to start bringing all our managers up to WSET Level 1 and 2, using wines from our own list for training.”
Ten people from across different levels of the Heartwood business recently went on a trip to Rioja as part of a sales incentive with Ellis.
“They come back and pass on what they’ve learnt to their teams in the pubs,” says Ferrier. “It’s amazingly beneficial in motivating our teams and ultimately enhances the guest experience.”
Investment in growing sales
Tim Bird, co-owner of Cheshire Cat Pubs & Inns, a winner at both this year’s Publican Awards and the 2023 Great British Pub Awards, says that nurturing relationships with drinks suppliers improves the package it delivers to its customers.
Suppliers such as Boutinot, Diageo, LWC , Double Dutch and local brewers and distillers contribute to the knowledge bases and passions of the category champions that Cheshire Cat has for beer, wine and spirits in each of its pubs.
“The one thing those suppliers have in common is that they see it as an investment in growing sales of their products through us,” says Bird.
He says there’s one overriding feature he looks for in a supplier, and has some advice for prospective suppliers about how not to go about things.
“We want suppliers who take the trouble to understand our business,” he says. “There are a lot of enthusiastic brand ambassadors and account managers who rush in with all the enthusiasm in the world to present their products but who don’t really understand our needs.
“I’ve had suppliers come in to show us 60 different things but we’re never going to take 60. Take the time to research our business and what we already have, and then tell me what we’re missing.
“There are almost too many suppliers out there trying to get things over the line. It ties up too much time for us as operators. We can’t read the lengthy emails and haven’t got time for meetings, so if they haven’t done their homework beforehand it’s pointless.”
Their team listens and says ‘we want to be part of this and this is what we propose’
Bird says, as a general rule, long-standing relationships work best and they become that way with good reason.
“Boutinot has been our main wine supplier for 15 years,” he says. “Other people have come in and done bits of work, such as Majestic Commercial, but it didn’t spend the same amount of time trying to understand how we want to train people, how we want to motivate the team, how we want to spend rebates and retros on educational trips.”
From the outside, it might be assumed that small suppliers are best or easiest to work with, but Bird says there’s been a noticeable shift in attitude towards smaller high-quality operators such as Cheshire Cat from some major brand owners in recent years – and suppliers are coming to terms with the idea that they need to have more to offer in an increasingly competitive on-trade landscape.
“Diageo is the best example,” he says. “I don’t think I’ve ever known such a large business be more supportive of a small company like ours – and I don’t think it’s just us.
“I think it’s changed strategy and thought that if it has 100 high-quality small pub businesses to promote its products in, then it has the equivalent of a large pub company.
“It’s a more bespoke approach. Their team comes and listens to what we want to do and they say ‘we want to be part of this and this is what we propose’.
“If you want to be the best pourer of Guinness you should ring Diageo and pin down your account manager and say you want to have the whole team trained on the perfect pour. I’d be amazed if Diageo didn’t support that.”
But still, not every supplier gets it right, he says.
“There’s so much money wasted by suppliers doing standard kits of beer mats and tent cards, because the marketing department tells them that’s what people want. We don’t do tent cards and we don’t do beer mats. They could save money by going out and listening to customers, get their products profiled better and get higher volumes as a result.”
Local suppliers championed
Stroud Brewery’s Taproom picked up the gong for Best Sustainable Pub at the 2023 Great British Pub Awards, and sustainability drives all of its relationships with suppliers.
Managing director Greg Pilley previously worked for the Soil Association, focusing on “community-supported agriculture, looking at relationships between food suppliers and consumers that wasn’t merely transactional”, and has carried those themes through to the brewery and taproom.
“We have lots of small horticultural producers and growers around Stroud that we source from. We work with Godsells Cheese and Zero Dig, which is a project to grow salad and vegetables using a low-dig method, with lots of mulching, to build up soil carbon and have low-maintenance beds.”
Pilley estimates that 60% to 70% of the products it stocks come from within a 50-mile radius and those local suppliers are championed on a blackboard in the taproom. This sort of exposure resonates with more customers as time goes on.
“There’s been increasingly recognition of the importance of identity and place to people,” he says. “They’re shifting their values and recognising that producers represent the place they come from.”
Pilley suggests that operators should also look at how to optimise a broader supplier base, beyond the tangibles of food and drink.
“We get our mains electricity from [locally based green energy provider] Ecotricity,” Pilley says, “but, in addition, our landlord, a local company, has installed solar on our roof and we’ve come to an arrangement to buy the power off them at about 20% less than what we can find on the open market.”
The relationship between me and those [local] lenders feels totally different than if I’d borrowed from a faceless bank
Stroud Brewery has also taken a creative approach to finance, with several rounds of crowdfunding.
Although the investment has been in the brewery, not just the taproom, it’s a model that could work for small pub companies or on a smaller scale for individual pubs.
“It was initially a bunch of mates and then it expanded to a wider network,” Pilley says. “The relationship between me and those lenders – of which 50% to 60% are local Stroudies – feels totally different than if I’d borrowed from a faceless bank. They wouldn’t have cared about my business and I’d have cared less about them lending it to me.”
Savings on water use
Larger pubcos also find value for their individual operators in the relationships they forge with suppliers.
Star Pubs & Bars is another company with sustainability high on its agenda and says a partnership with the PHS Group has saved water and cut costs for the 160 pubs in its Just Add Talent managed houses.
The washroom services package uses special taps to reduce water consumption for hand washing by 72% and infra-red tech to cut water use urinals by 85% by ensuring they flush only when used.
It says the set-up saves a typical pub around £451 per urinal annually and £140 on water going through the taps.
“The reduction in water charges offsets the expense of a really good washroom service,” says Star’s head of pub services Mark MacDonald.
Analyse the price of general waste disposal compared to recycling and look out for hidden costs
Star has also linked with Biffa in a deal that encourages recycling by offering favourable rates on recycled waste over landfill.
“People sometimes think that going green is more expensive,” MacDonald says, “but that’s not necessarily the case.
“General waste is the most expensive to get rid of and the price usually gets higher when a pub exceeds the typical 70kg allowance for a standard general waste bin. If licensees are putting heavy items, such as food and glass, into general waste, rather than recycling them, the price can soar.
“Licensees should check pricing carefully when they’re shopping around for a waste management provider. They should analyse the price of general waste disposal compared to recycling and look out for hidden costs, such as surcharges when they exceed 70kg of general waste.”
The quest for positive supplier relations that can enhance any or all of profitability, staff knowledge, product quality, sustainability, value for money and the customer experience runs through every aspect of a pub’s business.
As Tim Bird at Cheshire Cat Pubs & Inns says: “If you operate one pub or 10, you’ve got to decide what you’re famous for – and then go out and search for the suppliers who can make you even more famous for it.”
