Buying a pub may be a spur of the moment decision.
Before you sign on the dotted line, make sure that you do your homework. Running a pub is hard work and to be successful in the long term, there are a number of aspects you need to consider:
1. Marker research
Make sure that you do the necessary research, over the past couple of years there has been a decline in the sector but it’s not all doom and gloom, in some areas there has been a general increase in pubs, even in newly established businesses with younger owners. There has also been an increase in female pub ownership, with other innovations coming in to improve customer satisfaction. Sports pubs, gambling, live music, free Wi-Fi and other services, including pub meals can bring in a different type of customer or improve attendance by the regular customers in the area. Know the area and the clientele you will be catering for before you buy a pub.
2. Long term prospects
Besides a thriving business, you also need to determine if this is the right business for you. Gaining experience by working as a waitress, bartender, cashier and other services in a pub will give you a good working knowledge of how a pub is run and where you can improve your pub. There is a lot of competition in this sector and knowing your stuff can be the difference between making it or failing. You may even consider buying a pub and keeping on the staff including the manager to run it for you, but to ensure that nothing goes off track, it is still good to know a bit about the industry. A pub provides a service as well as food and drink and you need to be a people person if you are going to be on the front. No matter how you feel, you still need to present a friendly demeanour and keep your customers happy.
3. Different types of leases
You need to check if the pub is freehold, under a current lease or would need to be leased prior to you taking over ownership. If you rent, you may be taking over the current lease, which may only have a short period left, so you would need to ensure that you can renew at the end of the period. If you need to take a new lease, you may need to discuss terms and period of lease with the landlord before signing for the pub. Freehold is the best situation, but is often not on the table when purchasing a business. Make sure you know where you stand as you would not want to purchase the business and in a couple of years be evicted from the premises, especially if you have invested money in to the business at the specific premises in terms of design, décor, advertising etc.
You would need to ensure that you have the correct liquor licence in place which allows you to sell alcohol for consumption at your specific premises. For some licences, you may need to attend a training course. You may also need to provide proof of age and in some cases, a clear criminal record. Make sure that you will be able to obtain the necessary licences before taking ownership so that you are not operating illegally.
5. Type of business
When you know what the demographic is in the area, you can then decide on the type of pub you want to run. If you are purchasing an existing pub, you might want to look at how you can improve on it or raise turnover by bringing in more customers. You may be in an expensive area and may then want to offer gourmet meals and live music to your clients, or you might be in a more working-class area and want to look at offering a sports bar with big-screen TV’s for your customers and finger foods. You can look at catering for families, with good food and entertainment or offer a quiet, relaxed pub for retirees. Look at your potential market and base your pub on the type of customers you are likely to attract in the area. The more you appeal to locals, the better your turnover is likely to be.
Buying a business like a pub is a great idea for people wanting to be their own boss. Pubs are the cornerstone of any community, and with loyal customers as well as passing trade pubs are a great source of income and give you the chance to get to know people.