Landlords ring the changes in business

Landlords and pub owners must be seeing some major changes in their industry of late. Sales of alcohol have been falling as people tighten their belts and drink at home, while other areas of the market – such as good quality but well-priced pub food – have grown as consumers find themselves unable to afford a full restaurant meal out.

Even among the big players, things are far from steady. Take Punch Taverns, for example. At the end of 2005, the group owned almost 10,000 different pubs, attracting a wide range of clientele. But by last year, this had fallen significantly down to just 4,600, predominantly driven by the de-merger with Spirit Pub Company.

Punch is looking to lower this even further to around 3,000 good quality establishments over the next four or five years, which will involve the sale of around 1,600 more pubs.

All of this has come about due to changes in the market that have forced Punch to take a more focused approach to their operations. Buying up anything and everything in the hospitality sector might work when business is booming, but as grips on wallets only seem to be getting tighter, pubs and restaurants are being particularly hard hit and have been forced to rethink their approach to trade.

This reality is hitting at the top and bottom of the market and it is worth keeping in mind for those considering purchasing a single pub or a small chain of establishments: Business ain't what it was. This isn't to say that the market is barren of opportunities; it simply means that those looking to buy a business in the catering and entertainment sector need to have their wits about them and ensure that they are investing in an area that is still receiving consumers' closely guarded cash.

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