Buying and Running a Pub

maxh · May 16, 2010

Me and my friend are considering buying and running a pub in London.

Does anyone have any experience of this/common pitfalls/qualifications we need?

Our plan is to have a micro-brewery on-site. Combined with standard beers/spirits/wines etc..

We found a 1000 litre Micro-brew for £30k but that seems a biiit much (however it is largely automated)

Also what could we get mortgage wise (ballpark)? Then plan is for next year, by then we should have a combined pre-tax salary of £60-£100k

tony84 · May 16, 2010

Have you ever run a pub before?
If not and you want to run a mini brewery as well....your mad!!!

Seriously, running a pub isnt just a 12-12 operation.
You open up someone has to be around until you close, you then also get calls from 9am (sometimes earlier). The phone then doesnt stop until 6pm at night.

You can be halfway through something and a barrel will go, or you get an idiot or group of idots come in.
You have to be security conscouse to the hilt, especially in the current climate.

All of that and making your own beer.

arkybarky · May 16, 2010

Good luck trying to get funding from a bank on this one...bars/pubs unfortunatly fall under what they call a 'negative appetite' which is a fancy term they've invented for what they consider too risky an investement.
If you do get the funding for it, you'll need both the premises license which the place should already have if its trading as a pub already and a personal license, which is a 1 day course that should cost no more than £200. If you decide to brew your own beer/lagers/ales you might also need to apply for a seperate license through your local authority. I know this is needed if your distilling your own alcohol (distillers license)
The actual running side of the pub is a 24hr a day job..from dealing with beer line cleans, to stock ordering, endless drink reps popping in to sell you their latest revolutionary drink thats 'taking the market by storm' to concentrating on your busy night time custom!
Good luck in your project....a LOT of organisation goes in to making a success of such a venture in these tough times...

toastking · May 16, 2010

Mortage-wise you will struggle to get anything without security. Its based on earnings and projected earnings so I think you might struggle without a fantastic plan.

arkybarky · May 16, 2010

toastking said:
Mortage-wise you will struggle to get anything without security. Its based on earnings and projected earnings so I think you might struggle without a fantastic plan.

Even with a fantastic plan, some banks won't even look at it if you mention the words 'bar' or 'pub'

add to that a lack of experience in the sector and i'm sorry to say but you might be wasting your time....

MASSEY · May 16, 2010

Theres no money in a pub at all, i really wouldnt bother

Atilla · May 16, 2010

maxh said:
Me and my friend are considering buying and running a pub in London.

Does anyone have any experience of this/common pitfalls/qualifications we need?

Our plan is to have a micro-brewery on-site. Combined with standard beers/spirits/wines etc..

We found a 1000 litre Micro-brew for £30k but that seems a biiit much (however it is largely automated)

Also what could we get mortgage wise (ballpark)? Then plan is for next year, by then we should have a combined pre-tax salary of £60-£100k

Have you really lookwd into this?

Have a look round and see how many pubs are closing. How quiet those that remain are. All the grief that goes with it.
Add in the micro brewery and the amount of paperwork and auditing that goes with it.
With London costings you've got a snowballs chance in hell of making it work.

GaryF · May 16, 2010

Neil Morrissey did a series in which he and a friend bought a pub and released their own beer from their own micro brewery. It failed I think.

Maybe you should watch it.

14A · May 16, 2010

GaryF said:
Neil Morrissey did a series in which him and a friend bought a pub and released their own beer from their own micro brewery. It failed I think.

Maybe you should watch it.

I think maybe he did hence wanting to do it - No doubt Neil Morrissey abused his 'celeb' status.

GaryF · May 16, 2010

They were terrible really.

It did not look very fun either.

Atilla · May 16, 2010

GaryF said:
Neil Morrissey did a series in which he and a friend bought a pub and released their own beer from their own micro brewery. It failed I think.

Maybe you should watch it.

It did.

I saw him in Asda HQ when he was touting his product to the buyers, celeb status didn't help.

i234i · May 17, 2010

I have a pub, its hard work but if you get it right then it can pay off aslong as you 100% know all of your costs, your long term plan and all the rest in the middle.

Someone i know recently got a freehold too, but hes also been running leasehold for over 5 years with good trading records. Without anything like this or a hell of alot of security i'm not sure you'll get anywhere.

If your serious, worry about the microbrewery in 5 years time, get the pub up and running first. Its alot harder work than it looks, make sure the deal and costs are right or you will end up with no money and be making none.

And also.. people dont go to pubs for drinks anymore, you need to make them... drag them!

luvbusiness · May 17, 2010

Running a pub looks easy to me.... all you do is lean on the handles and when somebody wants a pint you just pull it.When somebody wants something to eat just pop a pie in the microwave...Bing two minutes pie ready customer can eat.

patientlady · May 17, 2010

luvbusiness said:
Running a pub looks easy to me.... all you do is lean on the handles and when somebody wants a pint you just pull it.When somebody wants something to eat just pop a pie in the microwave...Bing two minutes pie ready customer can eat.

ha ha thats what the five pubs per day that are closing thought too!

If you have not run a pub before and cannot buy a freehold I really would avoid this business. Most publicans and ask them, earn under the minimum wage - fact! And if you do get tempted under no circumstances take on a fully tied, pub co tenancy. I have seen many publicans lose there life savings and end up living in council accomadation after they have been evicted from there dream...

Matthew Barsauckas · May 17, 2010

Hi,

Running a pub is probably one of the hardest business environments to operate in.

I would look at investing your time and money in another area. As a previous poster stated, pubs are closing down all over the country.

Lee Jones Jnr · May 17, 2010

Old Eagle Eye seems to be the man who knows - ask him.

maxh · May 17, 2010

GaryF said:
Neil Morrissey did a series in which he and a friend bought a pub and released their own beer from their own micro brewery. It failed I think.

Maybe you should watch it.

Got a link?

And wow!

Wasn't expecting such a strong response!

Ok, so from what you're saying the micro-brewery is out....for now.

The pub itself isn't about making money, that's not our motivation. Obviously we want it to be profitable, but i'm not getting into it for the big bucks.

I know...a fair few....publicans so it makes sense to talk to them.

One in particular I know is doing crazy good business! I remember he took £8000 on a normal Saturday night recently, something he was very excited about!

I also realise pubs aren't a 'build it and they will come' entity. So location is KEY!

hmmm....still tempted but it's looking less likely

May 17, 2010

OK; being as positive as I can:

With good luck and a following wind (hurricane), you will get 70% LTV.

On top of that, you will need capital to invest, as presumably you willl want to make changes to the place.

Employing chefs is a huge nightmare (its a but of a psychotic job, spending 12 hours in a hot place, working your nuts off and not getting any interaction with your customers)

Leaning on the pumps and popping a pie in the microwave is what you pay minimum wage for.

Yip! It's a minefield!!

patientlady · May 18, 2010

14A said:
I think maybe he did hence wanting to do it - No doubt Neil Morrissey abused his 'celeb' status.

I went to Neil Morrisey's launch of Morrisey Fox brew and he ran down most publicans at the time stating they didn't 'know what they were doing'. Needless to say as they were new to the game, they could do better! I reckon he is eating his hat

Billmccallum · May 18, 2010

maxh said:
Got a link?

And wow!

Wasn't expecting such a strong response!

Ok, so from what you're saying the micro-brewery is out....for now.

The pub itself isn't about making money, that's not our motivation. Obviously we want it to be profitable, but i'm not getting into it for the big bucks.

I know...a fair few....publicans so it makes sense to talk to them.

One in particular I know is doing crazy good business! I remember he took £8000 on a normal Saturday night recently, something he was very excited about!

I also realise pubs aren't a 'build it and they will come' entity. So location is KEY!

hmmm....still tempted but it's looking less likely

Still tempted, don't look for London, property prices are manic and the best locations cost an arm and a leg. Anyone offering "A Great Deal" is trying to offload trouble.

To get an idea of the market, take a look here http://www.punchpubs.co.uk/Punch/Punch+Pubs/Apply+and+find+a+pub/Display+by+county/

these are lease operations, but they do give a good indication of some of the issues you will face.

14A · May 27, 2010

ITV4 @ 10pm today

Men Brewing Badly - Something to do with their own booze and the World Cup, I bet another failed attempt of theirs.

patientlady · May 28, 2010

14A said:
ITV4 @ 10pm today

Men Brewing Badly - Something to do with their own booze and the World Cup, I bet another failed attempt of theirs.

Blow I missed this! What was the prog about pls?

14A · May 28, 2010

patientlady said:
Blow I missed this! What was the prog about pls?

Its a new series, same time/channel/day.

You did miss much, abit like TopGear, they bought an old truck and want to travel 3000 miles through Africa to their destination were they can give out 'real' ale to the England fans - Of course they have their problems along the way!

Nothing to do with the brewing/running a business like last time, although I must quote something along the lines of 'Morrisey and Fox are brewing masters'

Naughty Vend · May 28, 2010

First rule, you must not be a "tied house" and be able to source your product from any location as well as sell your own micro-brews... the general trend is to approach the bank, be turned down, speak to the brewery, get tied into a contract / loan, default and wither.

I have a list here with the expansion / refurbishment schedule of a national chain through to 2011, the trend is reasonable food and reasonable prices without the boil-in-the-bag steaks because that's where the margins are. The supermarkets pricing war on alcohol is politics no doubt backed by the pub owners to get prices relatively speaking "up" in discount outlets, a good summer will be the death of many pubs because let's face it if you're not looking for some "rumpy" and I don't mean scrumpy a £10.00 case of twenty Budweiser from Sainsbury's is much better value than a glass of wine and a pint of Staroparpen for £9.75 plus taxi, kebab and a visit to the STD clinic.

You get the mates round and light the bbq, the best the publican can hope for is a late night influx of piss heads whom chase away the clientele they did have from supper time then it's early doors. This is no time to be in the pub game unless you have several years under your belt and forget working overseas in the Costas as many default to, that's even worse...

What's my background to know? My family owned seven pubs at one point, my father was a sales executive before that for a spirits wholesaler and retired into a pub (all Glasgow boozers), he retired retired out of a pub, I am still involved in the licensed trade and have been self-employed since I was fourteen. The best you can do is get back to tradition with modern ammenity, the Bar show is on soon in London (I think)... get there and see what's happening.

Naughty Vend · May 28, 2010

Tell you what I did see and though it would be "right" for the "right people", PortaPub...

You get the pop up marquee's for £200.00 and offer exactly as a mobile DJ would a mobile pub, you can replicate the business easily and inexpensively, get a couple of staff per unit and sort out the insurance / license issues with each council - there's a way around that too by the way.

Diversification into Hog Roast etc, less overhead, probably better margins.

patientlady · May 28, 2010

Naughty Vend said:
Tell you what I did see and though it would be "right" for the "right people", PortaPub...

You get the pop up marquee's for £200.00 and offer exactly as a mobile DJ would a mobile pub, you can replicate the business easily and inexpensively, get a couple of staff per unit and sort out the insurance / license issues with each council - there's a way around that too by the way.

Diversification into Hog Roast etc, less overhead, probably better margins.

Unfortunately there are more mobile caterers going out of business than pubs. All hit & miss - too many doing it..

Cookie Consent

Essential

Analytics

Marketing

Buying and Running a Pub

toastking

MASSEY

14A

luvbusiness

Matthew Barsauckas

Lee Jones Jnr

Billmccallum

14A

14A