Memorandum submitted anonymously
In my experience the BBPA Code of Practice has
not been robustly adopted by the Major Pubcos, Enterprise Inns
Plc most particularly.
In January 2007 I was in correspondence with
G E Tuppen, CEO Enterprise Inns plc concerning complete lack of
support/business advice/guidance as given by any of five Business
Development Managers I had encountered during my tenure with Unique/Enterprise
pubco. Having just devoted six years of my life, some considerable
physical, mental and financial Investment Included, I was on the
verge of Bankruptcy.
Potted history of me.... 52 years of age, thirty-plus
years experience in the licensed and catering trades having managed
my first pub at the age of 21. Former Member of B I and Member
of CFA, Craft Guild of Chefs since 1976. Former vice-Chairman
of local Parliamentary Constituency Assn, and founding Chairman
of Penarth and Dinas Powis Pubwatch Scheme. Attended 2004 TISC
as a interested observer.
Took on my first pubco opportunity with Unique
(now Enterprise). In May 2001: Pushed into signing a new lease
by my then BDM, ahead of completion of Schedule of Dilapidations
from out-going lessee. Was offered further opportunity in a neighbouring
county, no in-going and a full refurbishment planned. I'd obviously
become a "good catch" for the BDM and with a growing
track-record of perceived success, took on a third opportunity.
So, within the space of six months I was now responsible for the
running repairs, rent and trade of three, previously near-closed
premises.
Upon requesting trading Information on each
of the three premises, is provided with nothing by the pubco,
aiming that they did not have access to the out-going lessees'
records. Neither did they provide any sight of barrelage or purchasing
trends. Each of the three premises, i later discovered, had a
record of recent and continuing financial difficulty of which
the BDM would have been patently aware.
I battled on, with varying degrees of success.
I off-loaded one of the additional opportunities, by Introducing
a couple who moved to a new lease, having lost circa. £20,000
In the 12 months I had operated the business The Schedule of Dilapidations
In the original premises poorly executed and, despite constant
reminders to the Estates Dept. I was unable to achieve completion
of some of the most basic requirements, it has been particularly
irksome to find a number of the very items I was waiting for completion
on, to have appeared on my out-going Schedule! despite having
spent over £40,000 of my own money on improving basic facilities
In the main business, for example, new bar-fronts, extensive wall-panelling,
shelving and skirtings, together with a feature fireplace and
new fixed-seating throughout; that was claimed by enterprise as
"landlord's fittings".
Whilst those works were undertaken the BDM
in place suggested that he could arrange a rent concession, given
that I was having some difficulty in selling the other remaining
lease and that it was costing me some £900 per week to maintain
It as going-concern.
I was consistently working some 90-100 hours
per wet. The only time we saw a BDM was if the rent was late or
trade payments were delayed in any way. Or, as in the can of the
requirements of the new Licensing Act, to make sure our Premises
Application was in at a further cost to us of some £2,000.
Routinely, deliveries would turn up late or
damaged the BDM was nowhere to be seen then! Maintenance issues
would be passed from pillar to post with no tangible or Immediate
solution offered. In particular, drainage and cellar-cooling problems
would be ignored at peak times in both properties and ultimately
it was left to me to arrange and pay for temporary solutions whilst
they "looked into it".
When I eventually disposed of the second "opportunity"
at a net operating loss of some £60,000 over three years,
I moved the manager and his working partner to the main business
which was now performing well at around £10-12,000 of weekly
turnover, entirely due to my efforts. However, because the accommodation
above the pub was uninhabitable (it was de-listed for the purpose
of Council Tax), I had to rent a further flat to provide them
with the live-in portion of their salary package. Mr Tuppen is
happy to champion the value of the live-in benefit to be around
£9,000 per annum. He was not so happy to compensate me for
the loss of amenity, however. Nor was he prepared to reduce the
rental on the un-usable portion of the premises.
Ultimately, I must accept full responsibility
for my financial undertakings. However I can categorically state,
were it not for the Insatiable greed of the pubco-systsm, I would
not have been made bankrupt. In a six-year period, I re-opened
three previously closed premises, made Investment in all of them,
allowed Enterprise to amass approx one million pounds In rent
and trade, and yet I end up owing £100,000 to HMR&C.
Why? Because of the greed of the pubco complicit in the knowledge
that I had to use receipts of VAT and Revenue to support my cash
flow and settle their account under threat of non-supply. I would
wager that there Isn't a failed tenant/lessee in the COUNTRY who
did not go bust without owing VAT and/or tax; having first suffered
the duress to settle the account with their respective pubco.
And It gets worse....
Having surrendered my final lease to Enterprise
in March 2007, they immediately advertised it for sale on their
website for £138,500. That was my only remaining asset. And
enough to clear my tax liability! I left everything in the pub
for a seamless handover to the new Incumbent, having agreed a
paltry valuation of £13,000 for F&F. (The aforementioned
Improvements were "claimed" by Enterprise and did not
form any part of the valuation).
Under protest, I did not sign a "departure
statement".
In the week after my departure, they sent a
fictitious Schedule of Dilapidations, un-priced, and it has taken
me over 12 months to illicit the costs Involved. Surprise, surprise
eight out of ten items were outstanding at the time I originally
signed my lease. They did not see fit to provide me with the statutory
notice of application to close a registered leasehold title; were
they afraid the Official Receiver may have attempted to realize
some value in it?
I took, and paid for legal advice throughout
my association with the pubco. On three occasions I paid for Surveyors'
reports relating to two of the premises. Those reports were ignored
by the pubco. I remain convinced they only have one aim ... to
suck people in, often with no experience and let them learn by
their mistakes. Sadly for them, the supply of "lambs to the
slaughter" is now drying up.
I believe six years is way above the average
life of a current tenant/lessee, therefore I deduce I must have
done something right. Indeed, I was a finalist In the Pub of the
Year Awards In 2002, a regional finalist in the Perfect Stella
promotion, and first In the UK for a Budweiser/World Cup promotion
In 2006. However, each of the three "opportunities"
managed by me over that six-year period, have now further changed
hands AT LEAST TWICE since my departure. The real question that
needs to be asked of the pubco is this....
What constitutes a PUB closure?
I took on three previously-failed businesses.
Each one of those has now changed hands at least twice since.
I make that 13 closures between three pubs in six years. (And
how many of those were in debt to HMR&C?)
Are they Intent on continuing to over-rent unviable
premises? Will they ever adopt a fair and equitable means of assessing
rent in a falling market? And will they EVER end the ubiquitous
beer-tie? It is not the salvation of small brewers, as they claim,
it is the ruination of many businesses, many dreams and many people.
And as for the latest figures from BBPA claiming
that pubs are closing 18 times faster than In 2005, now up to
36 per week ... I haven't even touched on the effects of the Smoking
Ban, Credit Crunch or cheap supermarket booze!
29 September 2008
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