Are You Ready To Expand Your Pub Business?
For many pub operators there comes a time when the next logical step is to take on another site. Ambitious operators find that a multi-site pub business offers scope to grow, the economies of scale and the excitement and rewards a new project can deliver.
In this article Phil Arnold, Partnership & Recruitment Manager at Greene King Pub Partners, discusses the various factors that need to be considered if you are thinking of expanding your pub business, and offers advice for taking the next steps.
Having developed a successful and profitable pub business, one site can soon become restrictive for many operators who find they need more space to grow and develop, or create new ideas and concepts. You have the knowledge, the skills and the proof that you can make the business work, so why not?
Pubs are ideal locations for developing a multi-site business as you can expand at the rate you feel is right for your business. The experience gained from running one pub is easily transferable to other pubs. Investing in a second pub or more in order to create a multi-site business portfolio offers considerable long term scope for growth. It can also bring in cost savings as you can buy in greater bulk when necessary.
Andrea and Alan Smith Bowes, pub operators at The Elizabethan Pub in Dumferline have a portfolio of six pubs. Andrea comments: “Running six pubs means that we can employ centralised resources to help make the most of our businesses.”
Expanding Your Pub Business
Moving to a multi-site business does need considerable planning. As with any business you need to ensure that the necessary investment and management are available. You have to be prepared to release some control over your original pub in order to focus on the new one.
Multi-site pub chains can be ideal for family businesses, as it allows other members of the family to take on extra responsibilities. Andrew Macmillan, landlord of The Swan in Long Melford, has developed a chain of three pubs, He says: “I got into the business because my son is a chef, and wanted to build his own business. We went from there and persuaded my other two children to join us. Developing the staff and recruiting the staff is key.”
Debi Sicklemore and Alan Monks, owners of the White Horse in Sudbury agree. They already had two successful pubs in London, and wanted to take up another in a different location. As they had staff that possessed the skills to take over the existing Grafton Arms, Debi and Alan were able to concentrate on the new venture.
Expanding into new sites does provide new business challenges. There is a much larger team of employees, potentially different strategies relating to each pub, and you have to give up some day-to-day control over your existing business. It is no longer possible to spend all your time focusing on what is happening in one pub, you have to think about another location as well. This is why having good management in place is essential. Having reliable staff is essential for coping with opening and closing, taking deliveries, dealing with inquiries and maintaining standards even if you are not on the premises.
It may be that some members of your existing team are ready to take on additional management responsibilities and could transfer to a new location. Talented staff are highly valuable resources and need to be encouraged. By providing them with additional challenges and clear scope to expand their roles within your business, they are less likely to leave.
For more advice on staffing and developing the right team to support your multi-site business, you may like to read this article on working with pub managers.
It is a big move from operating just one site to operating two or more. It requires more flexibility, a strong business concept that can be easily transferred, and strong management. As Andrew Macmillan points out: “You get different issues with more than one site. You need innovation to run a multi-site business.”
Simply replicating exactly what you have found works on one site may not be enough. Every pub site is slightly different, as catchments, footfall and customers can vary. It is important to be prepared to adapt your concept slightly in order to make the new pub successful.
Finding Your Next Pub
Choosing your next site carefully is important. Ideally the new pub needs to be within easy distance of your original base so that you can check on progress of both sites - but should not be competing for exactly the same market. Andrew Macmillan, for example, began at The Swan in Long Melford and expanded onto sites within two nearby market towns – Hadleigh and Lavenham.
Most pub operators want to be able to use their first pub as a model for the next. This means that the site needs to have many of the factors your original pub has, such as a similar demographic of customers, or scope to provide the same offering in the trading space. However, sometimes it may be possible to create a different kind of business, if you have a solid foundation to work from.
You could also stay within the same locality if you are offering something different. Tom Kerridge, landlord of the Hand & Flowers at Marlow expanded into The Coach pub within the same town only a few years later. He felt that this move could work, simply because he wanted to try a slightly different concept focusing on pies and interesting, affordable food rather than the three course meals provided at the Hand & Flowers. His decision was helped by the fact that he had a chef able to move on and take up the new challenge.
Are You Ready To Take On Another Pub?
Below is a checklist of key factors that may help you decide whether the time is right to take on another pub.
- How’s your current pub's doing? Have you got to the point where you’re happy that your existing businesses are running smoothly, profitably and are fulfilling their potential?
- Is there scope to roll out your pub business model to other sites? What aspects of your business can be scaled to include more sites?
- Have you got the right people to scale your business? Have you got staff who can run your existing pub's while you develop a new business? Have you got people you can take into the new business to get it off the ground?
- Do you have the capital? A crucial question. It is vital that you balance the interests of your existing business with the costs of taking on a new site.
- What does a new site need to have? What things are you looking for in a new site to make it a viable business proposition? Are these achievable in the market you want to operate?
Talking to your Business Development Manager must be a priority. Tell them that you are interested in expanding, and that you want to know about any potential opportunities. They will know exactly what is available within your area and just what properties could suit you and your trading concept.
They also have experience working with multi-site operators and will be able to support you throughout this journey. Remember you don’t have to take a second or third site with the same pub company, although you may want to, however it is in everyone’s interests that you get the support you need.
If you are looking for a new opportunity and are not currently a Greene King business partner, get in touch to talk through your plans with our team. If you are already a Greene King licensee talk things through with your BDM, they are here to help!