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Running a Pub in the UK

If you have decided that you want to run or manage a pub the first thing you will need is a Personal Licenceand will need to apply to your local Licensing Authority or Licensing Board (Scotland), where you live.

Pub Liquor Licences, Regulations & Qualifications

Applicants will be asked for a number of things to support their application: one of these is proof that you hold a government approved licensing qualification such as the BIIAB Level 2 Award for Personal Licence Holders or BIIAB Scottish Certificate for Personal Licence Holders (Scotland). Applicants will also need a Personal Licence criminal record check (CRB).

If you have decided that you want to run or manage a pub and are looking to offer food in your outlet you will need to find out about food hygiene regulations and qualifications.

Managed Pubs, Pub, Leases, Tenancies & Free Houses

Tenancies and Leases can be obtained for around £15,000 whereas Freeholds can cost up to £2 million. You would probably make your choice according to the capital you have available.

In order to borrow money lenders will insist on seeing a business plan to show how you intend on making the business a success. A business plan is mainly used to show lenders how you intend on repaying the debt. A business plan is also useful to keep you on track with your intentions.

The plan must detail how you aim to make the business a success, when this will happen, who will be responsible for making things happen and finally where the finances come in.

Pub Co & Brewery Pubs

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Running or Managing a Hotel, Restaurant, Wine Bar or Pub

 

Once you have decided that you want to go into the licensed trade and run or manage a pub , you must decide what kind of outlet you wish to run. There are essentially 4 main routes to enter the pub trade as a freeholder, a pub lessee, a pub tenant or a pub manager.

 

Managed Houses: Managing a Pub For a Brewery or Pub Company

The pub manager is an employee of a company, usually a national or regional brewer or an independent pub company.

Managed houses tend to be large businesses with annual sales of £250,000 to more than £2 million. The managed pub sector includes most high profile town centre branded pubs and bars, the large branded family dining outlets seen on the edge of towns and many unbranded community ‘locals

UK pub managers are supported by area managers and well as skilled teams at their head office whose functions cover central purchasing, delivery of food and drink, information technology, catering, auditing and stocktaking, finance and accounts, sales promotions and human resources.

UK Pub Tenancies: Running a Pub as a Business For the First Time


Tenanted pubs tend to be the smaller and older community pubs in suburbs, estates or villages. Taking a pub tenancy is viewed as a low-cost route to running a pub for the first time. Its an ideal way to set up in business as a pub because in many cases the start-up costs are limited to covering a bond and for the fixtures and fittings and stock at valuation when taking over. Also in many cases pub tenants live on the premises.

Tenants pay rent , which is regularly reviewed, to the property landlord and are tied to buy beers and usually other products (such as ciders, wines and spirits) from the property landlord. Depending on the style of contract, they may be responsible for the maintenance of the property debut in most traditional pub tenancies, this remains the property landlord’s responsibility.

UK Pub Leases: Running a Pub in Partnership with a Brewery or Pubco

A long-term pub lease is a longer-term partnership agreement which was introduced in the early 1990s and they tend to be offered on all types of pubs and hotels by UK breweries and pub companies.

Like pub tenancies, pub leassees are ‘tied’ and contract to buy a range of wet products (beers, ciders and sometimes wine and spirits) from the property landlord. The greater security of tenure on the business gives many lessees the confidence to invest effort and their own money (which can be from a commercial loan) and expand the pub business.

Some lessees enjoy annual sales approaching £1 million. As well as greater security of tenure, the lease on the business can be assigned (sold on) at market cost and the lessee may receive a substantial sum on leaving the business, thanks to their hard work and business skills. In return for these benefits, as well as rent which is regularly reviewed, lessees assume responsibility for the physical upkeep of the property and there may well be other conditions depending on the type of contract.

Although some people consider leases to offer advantages over pub tenancies for people wanting to invest and build wealth over the long-term, the conditions are more onerous than tenancies

UK Freehouses: Running a Pub Independent of Breweries or Pub Companies

Freehouses are independent from brewers or pub companies and owned outright or on a mortgage by an individual and run either by the owner or a manager. They are usually free of tie and may buy their beers and other wet products from any source.