Lost profit to pub industry from beer quality issues tops £700m: Pubs are missing out on an average of more than £14,600 per year in profit through inadequate beer quality management, according to new research. The Beer Quality Report 2017, published jointly by beer quality and insight expert Vianet and Cask Marque, showed a significant untapped profit opportunity for operators due to in-pub quality issues that could more than offset the new business costs coming on stream from additional employment regulation and this year’s business rates revaluation. The pub industry as a whole is losing £709m a year in value through multiple issues around quality from cellar to glass. The figures come from a combination of waste, missed till yield, over-ranging and low throughputs, alongside equipment and cellar maintenance failings and lost sales through reduced visits and repeat purchase. This headline figure equates to 5.8% of total UK on-trade beer sales. Broken down in detail, analysis shows the pub industry is missing out on: an achievable extra £206m in waste reduction at a retail selling price of £3.50 per pint and 2% improvement in till yield of £248m; an additional estimated £182m in potential sales by delivering a consistently great pint, typically through improved line cleaning and serving beer to the customer at the correct temperature and specification; and some £73m through the cost of over-ranging and wasted beer taps on the bar. The report analyses critical quality measures from more than 220,000 Vianet devices in pubs and cellars across the country, which is then informed and validated by quality scores from Cask Marque’s annual visits to more than 22,000 pubs. The report showed retailers have failed to act on improving beer quality following last year’s report, with the same proportion of beer served too warm. On the critical issue of line cleaning, this year’s report showed, according to Vianet Business Insight research, one in three pints served to a UK consumer is via a line overdue a clean – again the same proportion as last year. Cask Marque audits revealed, based on visual inspection, only 72% of beer lines are perfectly clean, with the remaining pubs failing to keep adequate records and visible yeast build up. The report found the average annual difference in beer volumes of pubs that serve almost all beer via clean lines (between 90% to 100% of beer) and those that serve less than half (40% to 50%) via clean lines is 63 barrels. This equates to 18,144 pints over the course of a year – and is worth approximately £63,500 at a retail selling price of £3.50 per pint. Assuming a gross profit margin of 50%, that’s still worth almost £32,000 per year to the operator. Vianet managing director Steven Alton said: “This report lays bare the profit opportunity for all operators across the pub sector, regardless of whether they run managed, tenanted or independent outlets. Draught beer remains in value growth and beer still accounts for about seven in ten drinks sold in pubs. However, the findings in our report provide a much-needed reality check and demonstrate the category’s continued health could be threatened by quality failings.” Cask Marque director Paul Nunny added: “Cask Marque has spent nearly 20 years banging the drum about beer quality and still the message is not getting through to retailer. This is a damning report on the quality offer to consumers.” The report also found there were too many beer taps on Britain’s bars – with pubs over ranging by an average three pumps; one in four pubs had a major temperature issue last year, resulting in 6% of all pints served too warm – equivalent to 208 million pub pints; one third of cellars are outside recommended temperature specification; six in ten taps are dispensing less than 88 pints per week; and the north east and north west is where beer quality is at its best.

 

Hollywood Bowl owner sells 17.8% stake for £40.7m: The owner of Hollywood Bowl Group, the UK’s largest ten-pin bowling operator, has sold a 17.8% stake in the company for £40.7m. Private equity firm Electra Partners announced yesterday (Thursday, 6 April) its intention to sell up to 26,702,364 existing ordinary shares in Hollywood Bowl. The placing shares represented up to 17.8% of Hollywood Bowl Group’s issued share capital. Electra stated: “Electa announces, subject to completion, it has sold in aggregate 26,702,364 existing ordinary shares in Hollywood Bowl Group at a price of 152.5p per share, raising aggregate gross proceeds of about £40.7m. Hollywood Bowl Group is not a party to the placing and will not receive any proceeds from the placing. Following completion of the placing, Electra will not hold any ordinary shares in the company. Settlement of the placing is expected to take place on 11 April 2017, subject to the satisfaction or waiver of certain customary conditions. Investec Bank is acting as Sole bookrunner in connection with the placing.”

 

Burning Night Group launches FirePit Smokehouse & Sports Bar concept: Burning Night Group has launched a new restaurant and bar concept – FirePit Smokehouse & Sports Bar. The company has developed the Old Fire Station building in Bingley, West Yorkshire, into the American-style venue. Ormsborough, the parent company of Potting Shed Trading, which was founded by the management team of Burning Night Group and funded by the Downing EIS Pub Fund, has invested £1m transforming the grade II-listed building in Main Street. With Potting Shed having just celebrated two years in Bingley, Ormsborough has returned to the town for the first in what it plans to be a nationwide concept. Retaining much of the former fire station’s character, including the distinctive tower and glass frontage, the interior has been given a complete makeover. Americana, including classic car parts and neon signage, have been added and the FirePit features a smoker and wood-burning grill to create its US-style dishes such as burgers, ribs, pulled pork and brisket and homemade mac and cheese alongside American cocktails and craft beers. There is also a custom-built Airstream-inspired retro caravan for private diner seating as well as a 3.5-metre wide LED screen, shuffleboard and pool tables, and pinball machines. General manager Benjamin Comstive said: “Because it’s the Old Fire Station, this place is a real landmark in Bingley so we’ve kept lots of original features, inside and outside, and we’ve added some quirky touches like fire hoses and ladders to the decoration so there will be plenty of talking points and things to keep people interested as they go round the building. We feel with the success of Potting Shed, which has just celebrated its second anniversary, that there’s room for another exciting venue in town.”

 

Just Eat appoints non-executive director: Just Eat, the global marketplace for online food delivery, has appointed Alistair Cox as an independent non-executive director with effect from 2 May 2017. Cox is chief executive of recruitment company Hays and has significant executive and non-executive experience with UK-listed companies. He has previously been a non-executive director of international investment company 3i Group and chief executive of technology and outsourcing group Xansa. Just Eat chairman John Hughes said: “I am delighted to welcome Alistair to the board of Just Eat. His background within the UK listed sector, as well as his track record in technology and talent, will add significant value to our board. I look forward to his contribution as Just Eat continues to drive very strong growth internationally as well as in the UK.”