Getting started as a pub owner: 4 Things you need to know.

Pubs are central to the British way of life and over 15 million people visit them every week. Celebrities and footballers have always been associated with owning pubs, as well as ex-actors, entertainers and sports people. However, running a pub effectively can be tough for the layman without proper experience and training.

In recent years, the business has seen many a changes and is adapting to social changes taking place. Pubs have become more family friendly and offer meals on a regular basis. The charms of a cheap home made pub meal seems to attract the average restaurant goers in times of austerity.

If you are willing to put in some hard work, the business can be highly rewarding. In addition to effective management skills, you will need to have knowledge of catering, drinks and legal licensing as well as be a ‘people person.’

1- What kind of pub?
Before anything else, you should think about what kind of pub you are interested in running. You could do this by visiting different pubs yourself and by talking to the managers or owners. This would give you an idea of what to expect and what you would like to do. You could choose to run a country pub or a trendy city pub throbbing with youngsters.

2- Lease pub or a freehouse?
Once you have decided on that, you would need to make another big decision deciding if you want to run a lease pub or a freehouse. Of all the pubs in the UK, roughly 54% are owned by a pub company and other 16% are owned by a brewery. Only 30% are independently owned.

For a newcomer, a lease is often the best way to go. You can lease the property space and you pay the rent, which is normally around 12% of the total turnover, and depends on the pub’s size and type. Costs of tenancy can run anywhere from £20,000 – £50,000.

A tied-lease offers a cheaper option, where you tie up with a brewery and stock only their brands. The downside is that it restricts from stocking all the brands customers might like or from shopping around for a cheaper deal. Say for example, if a customer asks you for a Corona, you might have to offer them a Sol instead. It also makes beer expensive for you and you’ll make on average 20% less per pint in gross profit.

If you are willing to invest more, you could run a free of tie option where you have complete control over the drinks you sell.

3- What location?
Another important thing you would need to finalise is location. Ideally you would want to be catering to a particular type of audience. You can do this by going around the location and reading reviews from people on websites. This would let you know what people in a particular area are expecting of a pub.

You would also want to survey the building properly and make sure it complies with the safety regulations – fire, environmental, planning and health & safety.

Just like moving house you’ll need to cover legal fees and expenditures but also put some money aside for stock and to cover low periods. In addition, you would need to consider the wages for your staff. They are estimated at 20-25% of the ex-VAT turnover by experts and includes the wages for the manager. Managing it yourself should be a little cheaper but even so you will still need cover from time to time.

4- What licenses?
Along with the two licenses to sell alcohol, your pub will need to ensure – public safety, protection of children, prevention of crime and disorder, and reduction of public nuisance.

Getting a personal licence is the first step to start your career in the industry, where you can learn about all your responsibilities and applying for different licences.

If you want to know more about how the Personal License course and get your publican career under way you can contact us directly by calling on 0845 299 4049 or by email.

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