Review of the Year 2010: Pubs

The World Cup gave a welcome boost for pubs this summer

As 2010 draws to a close, we take a look back at how the pub sector has evolved in the past 12 months.

Call for Minimum alcohol pricing

Despite year-long calls from across the pub industry for a ban on below-cost alcohol pricing, which unfairly gives supermarkets the ability to under price pubs, the government has still failed to deliver. The ban was set to form part of the Police Reform and Social Responsibility Bill, as outlined in the Queen’s Speech in May. But by the beginning of December the Home Office confirmed it would not take the motion forward with the bill. It is thought the government is still struggling to define “below-cost” and has pledged to implement the ban “without delay”.

M&B shift to food-led focus; cast off non-core assets

Realising the potential of the casual eating out market was greater than that of wet-led pubs, managed pub operator Mitchells & Butlers shifted its focus to serving food. By late summer the group had disposed of 333 of its non-core pubs to Stonegate Pub Company, raising £373m, plus 52 Innkeeper’s Lodges to Travelodge, although M&B sold and leased back eight restaurants and pubs attached to the sites. Its new focus on developing six key food-led brands – Harvester, Toby Carvery, Crown Carveries, Sizzling Pub Co, Premium Country Dining Group and Vintage Inns – helped the group achieve a 5 per cent like-for-like rise in food sales for the year to 25 September. The group now plans to open at least 120 sites by 2012, possibly targeting airports and train stations as well as the high street.

CAMRA super-complaint continues

The Campaign for Real Ale’s super complaint over pubcos and the beer tie has continued this year, but to no avail. Despite claims that tied beer prices for tenants and rent setting systems are unfair, the Office of Fair Trading ruled at the end of last year that there were no “competition problems… adversely impacting on consumers”. However, after further lobbying from the industry body, the OFT opened the probe up to a six-consultation, but by October the OFT maintained that it failed to find evidence of any problems. CAMRA is still appealing over the original OFT decision in October 2009, while some industry figures have urged the body to “move on”.

Pub closure rate slows

Pubs have suffered incredibly over the past few years, but if performance this year is anything to go by, the end is in sight. Analysts found that the pub closure rate slowed to 29 per week during the first half of the year, from its all time high of 52 last year. They predict that while pub numbers will still fall until 2015, the rate will continue to slow, as a result of operators’ ability to adapt to consumer desires for food, all-day dining and coffee. Unfortunately the traditional wet-led pubs will continue to decline.

Sosho fire fails to dampen Downey’s spirit

Shoreditch’s Sosho bar and East Room club was gutted by fire in March after staff members failed to extinguish a tealight candle after closing for the night. At the time owner Jonathan Downey said the building looked like it had been “smartbombed from space”, and was locked in a bitter legal battle with insurance company Royal & Sun Alliance over payments due. Downey didn’t let the fire dampen his year though, and moved on to open Tiny Robot, Giant Robot, Redhook surf n’ turf restaurant, while his London speakeasy Milk & Honey was named Best Bar in the World for the second year running.

World Cup boosts summer sales

Thankfully the Gods were smiling kindly on Britain and gave us a glorious summer, complete with a global sporting event to boot. The effect of the World Cup football tournament and hot weather helped the pub industry realise the best pub sales (2.2bn between April-June) for almost two years, stabilising many businesses that felt the impact of January’s snow. Unfortunately, had England stayed in the competition for longer the sectors performance would have no doubt flourished, with London’s Reealpubs group claiming each game was worth £500k in revenue.

Biggest fall in alcohol sales

2010 marked the biggest fall in alcohol consumption for 60 years, a 6 per cent decline on 2009. British Beer and Pub Association chief executive Brigid Simmonds remarked that the figure went hand in hand with the falling number of pubs, claiming beer accounts for 60 per cent of on-trade sales. Beer sales dropped by 10 per cent in Q3 alone – a result of consumer fears of the impending spending cuts in October. On a positive note, 3,000 more pubs were found to be serving cask ale, a category that saw growth of 5 per cent over the year.

GPG blacklists bad pub service

In a bid to force pubs to improve their customer service levels, the Good Pub Guide blacklisted 381 pubs in October for delivering poor service. Four in ten pub customers reported receiving bad service linked to short staffing and slow service. Smelly dogs, grubby surroundings, overpowering TVs, piped music and poor beer and food were the main gripes named by consumers. The guide did however recommend over 5,000 pubs across the UK, the best of which it named as The Tempest Arms at Elslack.

Duty to fall on low-strength beers and ciders

Publishing its alcohol taxation report, the Government announced that duty would be increasing on beers over 7.5 per cent abv, but decreasing on beers under 2.8 per cent abv at the next budget in March. The idea is to promote sensible consumption of lower-strength beers to give responsible drinkers more choice. The industry reacted with open arms, but claimed the move was a “missed opportunity” to tackle the below-cost prices being charged by supermarkets.

Battlesteads named Great British Pub of the Year

The Battlesteads in Wark-on-Tyne, Northumberland was named the 2010 Great British Pub of the Year by The Morning Advertiser. Picked from over 100 short-listed pubs across 16 categories, the business run by Richard and Dee Slade was also named Green Pub of the Year. The couple turned the once rundown B&B pub into a sustainable, successful business with onsite vegetable gardens and carbon-neutral biomass boiler.

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