Friday 15 July 2016

Good News? Possibly Not.

The number of pubs closing each week is falling! From a high of 27 pubs a week six moths ago, to "only" 21 a week now. In 2014, the numbers closing weekly averaged 33. Significantly, the total number of pubs has fallen by a fifth in the last decade to around 52,000.  According to CAMRA, the Campaign for Real Ale, the closures have affected rural and suburban pubs in a disproportionate manner which is rather concerning, with suburban pubs suffering most with 317 pubs lost in the last six months.

While to some extent the rural losses are, if not understandable, at least explainable, but the loss of suburban pubs is particularly disappointing. I know from my own experience that here in Middleton, our Langley estate which had around 10 pubs around ten years ago, has dropped to, depending on how you attribute the area, to either one or none. This likely means that vast swathes of the country have no pubs within their immediate area. No nipping out for a quick one unless you catch a bus is unlikely to encourage on trade drinking or a casual pint just down the road.

The picture on the whole remains gloomy, with likely rises in food prices, national minimum wage, high taxes and increasing wholesale prices adding to the feeling that such gains as there have been being wiped out. In fact CAMRA boss Tim Page has said this could happen all too readily if there isn't another beer duty cut.  I wonder with all the uncertainty over Brexit if this is a realistic hope.

At the same time another worrying double whammy has been announced. The Yorkshire Post has an interesting piece about the numbers of pubs and bars in financial difficulty.  They say "An increasingly large number of pubs are going bust as landlords wrestle with a perfect storm of poor weather, England’s abysmal performance at Euro 2016, Brexit and the introduction of the National Living Wage, a report has claimed. Figures from insolvency specialist Begbies Traynor show that the number of pubs and bars which were dissolved in the second quarter increased 53 per cent to 831.
The research also reveals that one in five pubs and bars faces “significant financial distress”, also up from last year."

Now of course not all pubs that suffer financial failure will close, but the underlying precariousness of the pub game is highlighted by the difficulties landlords face.  Anecdotal evidence says that people are cautious about spending following the Brexit vote and with margins already tight, many more pubs are likely to face, at best, reduced circumstances. Around sixty percent of consumers expect the general economic situation to worsen in the next year. If that gloom does drive them to drink, it is likely to be at home rather than out in the local - if you still have one.

While CAMRA is right to highlight minor successes, it looks to me that unless things change dramatically - and that seems unlikely - that the bottom of this deep trench has not yet been reached. 

On a brighter note beer sales have stabilised somewhat following beer duty cuts, but much of that is in the off trade.

CAMRA Chairman Colin Valentine rightly advises people to use their local pub as much as possible. More than ever it really is "Use it or lose it".  Mind you if you look at the photo, I was saying that over ten years ago in Issue 2 of our then new Branch Magazine.



J Mark Dodds said...

Excellent piece.

We live in a bizarre reality where reality is not reported. The situation for pubs is dire. It's not difficult to gather the reality, all one need do is walk around any town on a Friday or Saturday evening and note how many people are in pubs. They are empty all over the country.

J Mark Dodds said...
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Paul Bailey said...

I’m not I agree with the gloominess you refer to TM; in fact I would say the opposite is true, and I can feel a strange air of optimism in the air which belies recent events and results. The fact I am saying this as someone who was extremely disappointed by the referendum result, is even stranger.

Without dwelling too much on the EU, leaving an organisation which gave us unhindered access to one of the largest single markets in the world is a truly ludicrous decision, but at the moment, things are not looking too bad. Perhaps things are different here in the “soft-south” and people have got more money in their pockets to spend on a night out. Certainly the pubs I have visited recently all seem to be doing quite well, although I will say there are very few wet-led ones still remaining, and I would also agree that suburban pubs, and especially estate-type pubs, have taken an enormous battering.

Talk from the Yorkshire Post though, about a “perfect storm”, is wide of the mark, and smacks of lazy journalism on behalf of the paper. We have had poor summers for a number of years now, so this one should have come as no surprise. The same applies to the abysmal performance of the England football team; surely by now people must be used to the national team letting us down at a major tournament?

The introduction of the National Living Wage is something which has been widely publicised. Pub landlords should not only be well aware of it, but also have had ample time to prepare for it. Rewarding people for their efforts, by paying them a decent wage can only be a good thing, and it is about time the so-called hospitality industry woke up to the fact they have been under-paying staff for ages.

The real reason why pubs are closing is changing habits, with people having far more choice of how to spend their leisure time. Pubs are not moving with the times, and an endless diet of Sky Sports, karaoke, quiz and fancy-dress nights is not going to attract customers across their thresholds.

Colin Valentine can advise people to use their local pub until he is blue in the face, but there’s a lot of truth in the old saying of leading a horse to water. Until pubs start offering people what they really want, rather than what brewery and PubCo bosses think they want, the sector will continue its sad decline. We would all like to see more people supporting their local, but until these underlying issues are addressed, then I’m afraid it’s game over for many.

Returning for a minute, to the doom and gloom theme, I think it is far too early at present to make a judgement one way or the other. The whole sorry business of trying to disentangle ourselves from the European Union will take a number of years, and as we all know life in general, and events in particular, have a habit of throwing up the unexpected. So with no real way of telling what might lie ahead, why not take each day as it comes and do your best to live and enjoy life to the full; and if there’s a decent glass of beer involved somewhere along the line, then so much the better!

Curmudgeon said...

"our Langley estate which had around 10 pubs around ten years ago, has dropped to, depending on how you attribute the area, to either one or none"

Hmm, I wonder what might have been a factor in that...

Stono said...

think the Yorkshire post is overegging their doom laden view there, how can Englands performance at the Euros have any effect when its pretty much been that standard of performance for decades, England havent won a major football trophy for 50 years, and its been 20-26 years since England have done even that well, so are pubs really building their business around a model that said hey we sold alot of beer back in 1990, I doubt it, and doesnt it ignore the Welsh did quite well, as for the rest of their "perfect storm" you might as well start measuring the butterfly effect.

it is worth pointing out the rate of pub closures will likely always fall anyway through no external factor, simply because there are less pubs now, you cant close a pub twice in effect, so the rate will decrease

J Mark Dodds said...

Broadly agree with your thrust here but assure you there is nothing of 'lazy journalism' about the Yorkshire Post which consistently produces some of the best informed and highest quality overview of what is happening in the pub sector of any regional or even national news outlet in the UK... Gavin Aitchison, the lead reporter there is clearly unusually well informed about what is happening and he has close contact with many publicans, licensees and diligent, hard working and researching CAMRA members and he follows the broader market in detail.

The 'perfect storm' in pubs of a summer season of dreadful weather and poor sporting events on top of perennially dire trading impacts the incomes of seasonally and event attractive pubs enormously. Thousands of pub businesses are barely clinging on and a five percent fall in income across one summer is easily enough of a bottom line impact to put many pub businesses out of business forever. Begbies Traynor and other distressed asset specialists' stats are the most accurate bellwether of the underlying health of the failing pub sector.

Having had 'ample time to prepare' for increased fixed overheads, be it wages, business rates, wholesale prices, energy supply costs, or whatever, means nothing to a business that is barely breaking even at the best of time or, much more likely, already struggling to service historic losses from a previous poor year's trading. When a lemon's dry there's no more juice to squeeze out of it no matter how hard a publican tries. No profit means no investment which leads on to your next point about changing habits... and while you are right about pubs not responding to changing habits they are not en mass about to change what they are doing, because without investment they cannot.

Pubs DO need to move with the times but there isn't any money to invest. Pubco freeholders' business model is to aggressively sweat their assets so they can pay down debt interest on loans they raised to buy their enormous (rapidly shrinking) estates in the first place. This is done through high rent and supply prices that leave publicans without profit to invest in improving premises, evolving product range (which is also severely impacted by the beer tie), training staff or any kind of business development that responds to the expectations of an ever more sophisticated and demanding customer base. And it is exactly for this reason that pubs will not start offering people what they want any time soon. It is NOT going to change and people are NOT going to be using their local until this is substantially addressed - you are right it IS game over for many...

Separate to this and hidden within the market overall, up to a third of all tied pubs at any given time are in the process of 'churn' and being operated on Tenancies at Will and can't really be described as true businesses anyway. They survive on low rents and beer supplies designed to keep them solvent and trading until substantive leases are taken up by people with some money to invest. ~

It IS doom and gloom. Even the impact of the madness of disentanglement from EU has depressed enough people in the UK for them not to go out as much as usual... THAT in itself is enough to tip many more pubs into going out of business...

Cooking Lager said...

Take time out from beer enthusiasm and ask what the point of pubs are. More the majority of people that don't fetishize beer. Lots of things that existed a century ago no longer exist now. If you can still see a point to the pub, then it's about how many are needed at any given time.

Oh and I guess everything for the next 2 years is the fault of Brexit. Oh dear. Still, I'm happy with it so that's alright then.

Curmudgeon said...

@Cookie - well, apparently the Turkish coup is all the fault of #Brexit.

Curmudgeon said...

@Paul - you are quite right to say that the decline in pubgoing is largely due to changing social habits. And social attitudes.

Simply, polite society is much less tolerant of drinking alcohol in general social situations than it used to be. So the range of occasions where a visit to the pub may be contemplated is much reduced.

I don't really think "giving people what they want" has much to do with it, though. As I posted here:

"At the end of the day, a pub is still a pub, and its fundamental raison d’être remains the same. It can’t “move with the times” by turning itself into something else. If people no longer want to go to pubs, no amount of wine dispensers, crèches, coffee-makers and wi-fi hotspots will make any difference. Even if every pub in an area was a Spoons or a Greystones, I doubt whether overall trade would increase by more than a couple of percentage points. And one of the oft-advanced examples of “moving with the times” – the general admission of children – is to many longstanding pubgoers excruciatingly offputting."

What I want in a pub hasn't changed for forty years - a comfortable seat, a good pint at a fair price, an absence of obnoxious and threatening customers, not being made to feel out of place, no noisy children and no piped music. A lot more pubs delivered that in 1976 than they do now.

RedNev said...

Everyone knows that no pub ever closed down before 1st July 2007. Happy regulars clustered around the old Joanna and sang "Knees Up Mother Brown" all evening while happily swigging pints of foaming real ale. Dogs sat patiently under tables waiting for stray crisps while children were all without exception tucked up in bed at home.

Ah, the good old days!

Curmudgeon said...

Usual tedious crap there, Nev. I have never claimed that the smoking ban is a monocausal reason for the decline of pubs.

But do you accept that in reality it has been a significant factor?

J Mark Dodds said...
This comment has been removed by a blog administrator.
Tandleman said...


Thanks for the lengthy comments:

Firstly, there is a mixture of optimism and pessimism up here. I reckon it is likely to be much the same in Kent. Kent isn't all Tunbridge Wells as you know better than me.

I agree too about changing habits which is why I think we haven't reached the bottom yet. As for giving people what they want, that is tricky as what I want isn't what everyone else wants and vice versa. I do agree though that it is difficult to find the answer, though some pubs achieve it. It is really about finding a niche that attracts the right sort of customers for you and then keeping them. I doubt quizzes and karaoke will do that.

Stono: Umm. Yes indeed.

Mudgie: I think you have a pint about what might work for some at least.

I don't think we are that far away from agreement and your advice to try and get on with things is good.

J Mark Dodds said...

Tandeleman I've tried posting here three or four times since my first 'excellent piece' above but nothing gets posted each time I try. Any idea why this might be please?

Tandleman said...


Just checked spam and there are two items from you, already published though, hence duplication.

Will remove when you have seen them. Hopefully won't happen again now, though I have no idea why it did.

Tandleman said...

It is now there four times!

J Mark Dodds said...


Really sorry to have all those hanging around... PLEASE do delete asap!

Best wishes

and thanks !


py said...

"Sky Sports, karaoke, quiz and fancy-dress nights"

My god, I wish some of the pubs round here would do something like that. There is always the risk that the U50s might visit the pub as a result I suppose.

py said...

"a comfortable seat, a good pint at a fair price, an absence of obnoxious and threatening customers, not being made to feel out of place, no noisy children and no piped music"

Sounds like you are describing your living room - surely there is more to a pub than that?

J Mark Dodds said...

"a comfortable seat, a good pint at a fair price, an absence of obnoxious and threatening customers" IS key to sustainable success in all pubs... A lot of other ingredients that can make up truly excellent pubs are icing on top of the safe simple quality cake and the decorations can be almost infinitely varied.

What the icing looks like depende on what the local catchment needs / wants/ aspires to and it's the job of the publican, the guardian of the establishment, to nail that and deliver it.

Curmudgeon said...

"Sounds like you are describing your living room - surely there is more to a pub than that?"

No cask beer in my living room for a start. But those are just the basic starting points - as Mark said there's plenty of icing on the cake over and above those, a good buzz and a variety of other customers for a start.

Curmudgeon said...

"There is always the risk that the U50s might visit the pub as a result I suppose."

More like a class thing, I'd suggest. But are there really that many working-class punters in Cambridgeshire?

py said...

Which class do you think it is that enjoys "Sky Sports, karaoke, quiz and fancy-dress nights"? That seems to me to be a whole mixture of class stereotypes.

I think the number one starting point for any pub is that it is a place to meet people. You can have pubs without beer (I've been in some), but you can't have pubs without other people. Yet no-one appeared to mention this in their definition of a pub.

"At the end of the day, a pub is still a pub, and its fundamental raison d’être remains the same" - yes, to provide a place for people to meet and socialise.

Paul Bailey said...

There’s been some good debate here and some really interesting comments, but what it seems to boil down to is there are no easy answers, and certainly no “one size fits all” solution.

Food for thought and plenty of ideas for further blog posts, but I think I know, Tandleman, what distinguishes Tunbridge Wells from the rest of Kent; and it’s not the fact that the town was the only one in the county to vote the right way in the EU referendum!

All will be revealed.

RedNev said...

Curmudgeon: no I don't.

Curmudgeon said...

"Curmudgeon: no I don't."

Still mired in denial there, Nev :p