Marston’s is to adopt a “renewed focus” on the proposition in its food-led pubs after falling behind the market with its offer, chief executive Ralph Findlay told MCA.
“We are going to do something about that,” he said, explaining that this partly informed the decision to combine all of its pubs under one operation.
The business has reorganised its pub operational and commercial structure and no longer operates distinct Destination and Premium, and Taverns, segments. Instead it will report its pub business under ‘Pubs and Bars’ from FY2020.
“It is all about shared learning, values and culture, but it also means format and menu reduction and we have an objective in mind and that is to improve the consistency of our offer and our service,” he explained.
Despite reducing capital expenditure by around £30m in 2019, Marston’s will be spending around £85m on its core estate this year, with the majority to be invested in its food-led estate, due to its size, but funds will also be allocated to its community pubs and premium business in order to elevate the experience in those, said Findlay.
“For example, we recently took a family food-led pub, The Lazy Pig in the Pantry at Chesham, and converted that into a Revere premium country pub. We are likely to be doing more of that kind of thing as well,” he said.
Marston’s wet-led pubs achieved strong growth over the last financial year, outperforming the market. Findlay said that in order to maintain that level of growth it was important to improve its drinks ranges and premiumise its portfolio, follow the trends in the market such as the growth in low and no alcohol, and build on the experience side of pubs.
He said some of the growth trends such as escape rooms and concepts like Flight Club Darts were very adaptable to a pub environment. Therefore, the business has been investing in experiential elements, such as digital darts kit and introducing that to a community pub environment.
Marston’s is also going to be investing an additional £2m in staff training during the current financial year, in order to tackle the issue of staff shortages and productivity, with an emphasis on better recruitment procedures and improving retention rates, including better motivation and reward.
“Performance improvement is part of the targeted outcome and we are trying to get that by reducing staff turnover in key roles and by increasing the number of vacancies that we fill from within,” he said.
The business is ahead of schedule in meeting its £70m target for disposal proceeds towards its overall target of reducing net debt by £200m by 2023, recently confirming the sale of a package of 137 pubs to Admiral Taverns for £44.9m. Findlay said it was unlikely there would be any further disposals of pub packages on that scale, and that subsequent sales would include single sites, and potentially some small groups.
Performance for the pub operator and brewer has been positive in the year-to-date, with like-for-like sales growth for the first seven weeks of the new financial year, however Findlay would not be drawn on specific figures.
He said bookings for Christmas were up on last year. “I strongly suspect people will be determined to have a good Christmas. I expect election fatigue will set in and head to the pub pretty soon,” he added. And with the Euro 2020 football championships taking place next summer Findlay said the outlook was good for next year.
Commenting on his hopes for what a new government could do for the sector, Findlay said that while National Living Wage increases were a given, the need to be sensible about the time frame within which these increases are to be achieved was vital.
“To try and cram significant increases in the Living Wage into a short period of time I think is really counterproductive. If we are going to see that increase in cost, we need some help in areas where we are currently being hindered, such as business rates and beer duty,” he said.
Ralph Findlay: ‘We are behind the market on food’
Marston’s is to adopt a “renewed focus” on the proposition in its food-led pubs after falling behind the market with its offer, chief executive Ralph Findlay told MCA. “We are going to do something about that,” he said, explaining that this partly informed the decision to combine all of its pubs under one operation: ‘Pubs and Bars’. “It is all about shared learning, values and culture, but it also means format and menu reduction and we have an objective in mind and that is to improve the consistency of our offer and our service,” he explained.