A sorry tale from a genuine Pub Co TAW/Lease.
My profuse apologies, but my thoughts regarding a TAW with a Pub Co was an intro to running a pub, it would appear that they are now calling their short term leases a Tenant at Will, TAW.
Those that take them would appear to be jumping out of the Lease Frying Pan into the TAW Fire, from these comments.
This now means that we cannot recommend any form of tied lease or TAW until these Pub Co’s comply in total with the New Legislation.
What they are doing is perfectly legal, but morally unacceptable and we seem to be getting emails like the following.
If you insist on going to these companies, please, please contact the PCA for advice, they are supposed to ensure everyone taking any form of lease or tenancy with the Major Pub Co’s is fully informed of all their responsibilities, both long term and short term, if they give you everything in writing, you may have some form of redress, but don’t bank on it.
Sadly we are only Conjurors not f……… Magicians, but we do manage to help people if they are not too far adrift.
This particular Pub Co over estimated the possible barrellage by 21% and then apparently recommended a company to do a Business Plan.
They should have based their Business Plan on the existing business, not on something 21% higher, anyone that has bought a pub and I have bought a number, knows that predicting an increase of more than 5% is sheer optimism and crass stupidity.
If the Pub Co find that you are not keeping up with your business plan and are struggling financially, you get classed as a Retailer Failure and are heading for the door, as soon as legally possible.
One of the major Pub Co’s Hatchet Men after threatening me with lawyers, we started talking.
I pointed out that over estimating FMT was a sure fire disaster, he admitted that the over estimation by his and other companies, we would need at least 50%, if not a 100% increased brewing capacity, when consumption of Beer in Pubs is now falling.
I’m sure you receive 100’s (if not 1000’s) if these e-mails. So I apologies in advance for posing the same dilemma as many others.
Where to start, other than say we have made a catalogue of mistakes (honest mistakes), in thinking we could change the fortunes of a local pub. Myself, my wife, a friend and his wife, bought into a tenancy from xxxx Inn last year. (TAW from May 2018, and substantial agreement from August 2019).
We very foolishly decided to invest money into the pub, and refurb the majority of the property. We did this through a business loan, which we are now seeking legal advice for as believe we were mis-sold from a company called xxxxxxxxxx.
We all have business backgrounds, with myself operating 2 multi million pound hotels in Cambridge, both of which operate high volume bars and restaurants. This was my thought process behind thinking I had experience in the industry, I have since found my ability to make a pub profitable (or even break even) from the top line sales, rent price and drinks ties is nigh of impossible.
We have had many months now trading at a deficit, and have got into a debt of approximately £20k with xxxx (with an £11k deposit, so real terms around £9k debt).
We gave our notice on Jan 2nd, which will come up to July 2nd. However we are in a position where we do not believe we can get through the next month as have completely run out of personal money. We have in total got about £80k worth of debt from numerous business and personal loans just to keep the pub operating. We understand we have made mistakes, but also the pub is trading nowhere near the recommended barrel age numbers provided by xxxx initially (more fool us).
The question I have is, what genuine pitfalls are there with just closing the doors. Will the brewery be forced to get in a management company if so. We do not have the funds (without absolutely crippling ourselves and remortgaging) to continue to operate and build up higher debt. Do you have any advice to be able to just cut ties and get out. We will pay what we owe (approx £9k currently). We just don’t want to stay for another 4 months and build another £25k worth of debt in that time. We do not want anything for free, and we are honest people who tried to make things better for the pub, it just hasn’t worked. Pressure and stress have really put strain on personal relationships and we just need to find a way to get out. We have floated the idea of closing, to be told we could be taken to court and have numerous fines placed on us if done so.
Any advice will be much appreciated.
The views expressed are not necessarily the editors and www.buyingapub.com accepts no responsibility for them, we do try to avoid offensive or litigious statements being made. They are written by concerned professionals in the industry who feel that these issues should be raised to ensure that all licensees are made fully aware of many hidden pitfalls.
Please note, access to this site is totally free if you would like to subscribe (No Charge) on www.buyingapub.com, they are free to be read for your guidance and aimed to help you get through a time of considerable pressure and demand.
copyright (©)2015, www.buyingapub.com