Here are some questions to think about before you take the plunge…
The first thing to consider is if you have the sufficient funds to run a pub tenancy. Just having enough money to buy the stock and pay the deposit may not be enough, and you may find yourself running out of available cash as most businesses lose money in the first few months of trading, so be prepared and make sure you have the necessary funds to see you through. Don’t forget the wages of your employees and your manager's cost if you have one. This is usually 20-25% of the exc. Vat turnover. It is always advisable to consult an accountant on these matters.
How will running a pub affect my lifestyle?
Running a pub is a way of life, with long working hours and never really being “off duty”, the stamina needed can put a strain on personal relationships. You will live and breathe the pub, within the community you will be seen as the figure head and host, able to deal with difficult situations as well as being able to recognise locals by name and remember what they drink. Mental gymnastics, excellent customer service and management skills are what’s needed along with charisma and a flair for the job.
I’m ready to take on a pub tenancy, what do I need to do before I move in?
The first few days of any Pub tenancy and the lead up to moving will be extremely busy and exciting. The more planning you have done before you open your doors to paying customers, the smoother the change over should be.
You should have set up a business bank account, registered for VAT, decided upon your menu, arranged a stock taker and an accountant, made arrangements for the initial beer delivery and set up any suppliers that are not part of your tie, for example food suppliers or utility companies.
The first day and night of your tenancy will be a real test. Make sure that the first experience the local customers have is a friendly, relaxed atmosphere. This will stand you in good stead for the future.
What attracted you to want to run a pub?
If the answer is that “you have always fancied running your own pub” and “you always liked the thought of standing by a bar drinking with your friends”, be warned, a pub tenancy takes serious commitment and to be successful needs to be run as a serious business. However if you are enthusiastic and keen to create a thriving business this could be the job for you!
What do I consider when selecting the pub to suit me?
The pub you chose should allow you to develop your individual character. A key point, once you have chosen the area you wish to work in, is to identify the competition. Look at whether the area is well serviced by pubs and restaurants and identify the niche you wish to pursue. Does the town or village look clean and tidy, is it locally regarded as being a good area?
Finding out the circumstances behind why this pub tenancy is on the market could be influential to your decision. If the tenancy is on the market because it was unsuccessful, try to find out what they were doing wrong. Were they serving expensive food when the demand was really for a good local drinking pub? There is no point repeating a failed operation and expecting different results. Adapt and improve the situation to suit you.
Check their books, volume history figures from the last year and also speaking to the outgoing tenant will give you an insight into their financial data. The condition of the building itself has to be thought about, will further expenditure be needed in order to fix the pub to a respectable level.
By considering every aspect of the tenancy's situation and location, you can assess your target market and through an effective business plan decide if you are going to be able to make any money.
What Rules and Regulations are there for pub tenancies?
To sell alcohol for consumption on your premises you must have a personal licence, which is issued by the Local Authority.
You must be over 18 years old, have no criminal record, prove that you are a ‘fit and proper’ person and understand your legal and social responsibilities. It is also desirable to complete the three day British Institute of Innkeeping (BII) course. If you plan to develop the catering side, you will also need to contact the local environmental health department to ensure you meet their standards.
Remember that you are not alone - there is plenty of guidance available from Hook Norton Brewery when deciding to take on one of our pub tenancies. We will give first time tenants step by step reassurance as to what courses or training they need. Also for the more experienced tenant the chance to create a business of their own with the background support they need.