We should probably admire the glass-half-full attitude ... Inapub March 2013

We should probably admire the glass-half-full attitude that that David Chubb of accountants PricewaterhouseCoopers brings to his role.

Chubb, a business recovery partner specialising in the hospitality and leisure sector, recently speculated that the fact that the insolvency rate in the pub sector is roughly level year-on-year, while the rate in other sectors is falling, “may suggest that the sector is stabilising and this is the normal rate of failure to be expected in a quarter”.

Leaving aside the fact that insolvency specialists calling themselves ‘business recovery partners’ is a little like Count Dracula calling himself a ‘blood donation adviser’, it requires a special kind of cock-eyed kind of optimism to take the view that that it’s fine for to pubs to expect a higher failure rates than any other business sector.

Thankfully, it’s also an attitude that’s starting to seem old fashioned. The days when pub companies built tenancy turnover failure rates of around a third into their recruitment estimates, if not quite gone completely, are fading. Admittedly, change isn’t happening without a certain amount of government arm-twisting, but alongside those structural reforms, pubs have been quietly reinventing their place in the market.

Douglas Jack, the widely-followed hospitality analyst with Numis Securities, recently categorised the current state-of-play as a “golden age” of innovation for the pub sector.  He told the Financial Times that pubs “have always been adaptable. They keep surviving and they reinvent themselves. They've moved to food and they are doing it better than restaurants and at better value for money.”

This view is supported by industry analyst Horizons, whose research shows that pubs now account for 20% of eating out occasion, and that pub operators have been steadily taking market share from the branded restaurant players, a trend forecast to continue during 2013.

I’m not, for a second, suggesting that running a pub is anything other than hard work, and I know some businesses fail despite the enthusiasm and dedication of their owners. But in a market where pub food is the first choice for many consumers when eating out, planning for higher levels of failure seems to be the wrong approach.  

On the menu this month:  On one of my regular jaunts into London’s glamorous West End, I was enjoying a pint and a spot of light jazz at the recently-refurbished Hippodrome on Leicester Square. One of the bar snacks caught my eye – for £2.50 patrons can enjoy salted pork crackling served with an apple sauce dip. Sorry, but that’s just pork scratchings with a posh name. Stop showing off.

 

This 'Pub Food with Porter' column appears in the March 2013 issue of Inapub