Tim Bacon, chief executive of restaurant and bar group Living Ventures, talks building brands, developing a company culture and people, expansion and Manchester.

It is interesting developing brands from a standing start, where you have no real experience and you dive into the market. The lessons I learnt from starting brands such as Prohibition and Living Room were three fold. Firstly expand in hubs. Don’t do what we did with Living Room, which was to expand from Scotland down to Bristol, which left us running around like mad people trying to control the operations, while doing fresh food, live music, cocktails etc. It was very difficult.

Growing your own talent is a big one for me. Culture is at the very heart of everything that we do as a company. We very much value the people who work for us. There is a like-mindedness in our business which is incredibly important. I have tried to bring in some senior people from outside the business and they always tend to get ripped apart by the people underneath them who will not accept being dictated to from someone coming into the business. If you do bring external people in has to be through a process of slow and gradual acclimatisation.

Learning to manage

Another thing I learnt was: manage, don’t do. I was one of those guys who rushed around trying to do everything, thinking that if I didn’t do it wouldn’t get done properly. I now very much helicopter over proceedings. Some CEOs and MDs don’t know their own limitations, believe me I know mine. The business has been structured so I don’t make those mistakes again.

In our business today, we have 38 sites and will run though £75m of sales this year. We employ more than 1,400 people and trade from Scotland to London, with a major focus in the north-west. Each brand stands alone and has its own management team and funding structure. The underlying principles to make sure that these group of companies work and are kept fresh means we focus a lot of energies on making sure each team is an entity in its own right.

For example, Chris Hill, who is MD of New World Trading Company (a division of Living Ventures), has come up through the business. NWTC is funded by Hill Capital and Lloyds, and I sit on the board as a non-executive. That is the style of development we like. It enables people to develop and grow and it means we don’t lose people from the business. You find that the good people have nowhere to progress to, but having this structure of different brands allows us to navigate around that and to develop and keep talent.

We only employ nice people. That sounds a bit trite, but we employ people who get on with each other. I don’t see the point of having excellent people if they are not nice. Phrases like hire hard, fire easy and groom or broom – we live by these principles. We quite often move on big chunks of our staff because they have been around too long and are not doing the core things that we employed them to do from day one. It is quite a difficult thing to do.

Measure everything monthly. We consistently measure performance health checks front of house and back of house. We also do aesthetic checks and have a designer who goes around each site every month to check that the look and feel of the unit is still right. We also do numeric forecasting on a weekly, monthly and quarterly basis, let alone budgets. So we really measure the business quite strongly.

We train, and then we do some more training. The training manuals we operate to now, I first wrote in 1991. They are as valid today as they were then, because the principles don’t change. Make sure that the consistency of the operation is always there.

Probably the most important thing to my mind, is to keep each unit local. One of the key things I like when I go into a restaurant is to feel that it there for me, not just there from a national perspective. I think one of the big lessons being learnt at the moment, is that the London operators coming into Manchester now are taking much more of an interest in their local community, whereas historically speaking it was all about brand value and this is what we do nationally. We look at every single site and employ a business development manager at each site and they work with the local communities. We support local teams and charities.

Operating in the regions

You talk to people inside London about the regions and they treat it like it is a different country. Operating in the regions has its pluses and minuses. One of the main pluses is property. Sites are generally cheaper and reverse premiums generally still exist in the regions. I find that the difference between the cities is relatively marginal, it is all about market size more than anything else. You look at Manchester, Liverpool and Leeds, the markets are there. The size of the markets might change, which means you have to be a little circumspect on what units you introduce to those place. Is Leeds ready for an Australasia,will it support a £6m a year business? Probably not. Liverpool probably would at a push.

As you can imagine, the restaurant sector in Manchester has changed quite considerably over the past 20 years. It was a very interesting place in 1993. It was a bit of a playground, before the council and police took a more active role in the development of the circuits and action points in the city centre. Manchester became a progressive city and it has been on the march ever since. The difference between then and now has been quite extraordinary. If I look at concepts that we are running now like Australasia, which is a £6m business, and the fine-dining Manchester House, there is no way in the world that those formats would have existed or succeeded in the Manchester of seven or eight years ago. The way that the market has moved, a sort of convergence if you like, going on that London journey in terms of maturing and sophistication, has been a pleasure to watch.

Years ago I said that Manchester needed around 50 restaurants “of size” to make it an interesting place to dine and we are getting pretty close to that now. We now have a number of London operators coming up and getting into the city, which has not always been the case in the past.

I have watched loads of London brands come to Manchester over the years and the main rock they stumble over is their specific view that their brand is their brand, and they keep it nice and tight in London because they can. In London you can operate a tight brand because the markets are so big and numbers in each market are phenomenal. The brands that came up before, their offer wasn’t wide or aspirational enough. If you are going to do a tight offer, make sure your site is right.

Businesses are a team sport. You need to approach business as a collective. You put a team together in which the individuals are like minded and friendly and you end up with something quite special. I do think from a Living Ventures’ perspective we do have something quite special.

Tim Bacon was speaking at Zolfo Cooper’s North Lights Conference