Heineken pub venture targets would-be entrepreneurs

Star Pubs & Bars is looking to pump a seven-figure sum into what is being billed as the first turnover and profit share pub agreement in Scotland.

The initial sites earmarked for this new style of agreement are the Thistle Tavern in Dunfermline and Kirkcaldys Chapel Tavern, with more planned in early 2019. Image: Contributed

The firm, which forms part of brewing giant Heineken, believes that the “low risk, low cost” initiative will make it affordable for would-be entrepreneurs to run their own bar business.

It is hoping to attract “a new breed of hospitality operator” looking to strike out on their own while receiving “a high level of direction and support”. The firm is planning to invest more than £2 million over the next 12 months rolling out the scheme.

The initial sites earmarked for this new style of agreement are the Thistle Tavern in Dunfermline and Kirkcaldy’s Chapel Tavern, with more planned in early 2019. Both the initial sites will be supported by capital investment of about £700,000 in total.

The “Just Add Talent” agreement complements Star’s existing line-up of leases, and is said to be particularly suited to community pubs that can offer food and drinks, supported by live entertainment and TV sports.

Brian Davidson, regional operations director for Star Pubs & Bars, said: “The Just Add Talent [JAT] agreement appeals to a new breed of operators, who have the retail experience, drive and ambition to run an exceptional pub business but are looking for direction and support to help make it happen.

“The agreement reduces operator risk. With Star funding, training and business development support, and a great range of Heineken premium brands, it provides a real opportunity to create long-term viable businesses for the next generation of licensees.”

He added: “We will have 113 JAT sites in England by the end of the year and receive significant interest whenever we look for operators to take on these pubs.

“We believe this type of agreement will be especially popular in Scotland as two thirds of the pubs are independent free trade owned and therefore out of reach for the majority of those looking to run their own pub for the first time.

“It also introduces a new entry to the pub market as a stepping stone from managed to leased and tenanted, and, for those who want it, potentially to the free-trade over time.”

As part of the agreement, operators run the business and fund their own staff costs. Star Pubs & Bars pays all other expenses including electricity, heating, TV sports, rates, food and beer supply and maintenance costs.

The firm said this allows operators to concentrate on front-of-house and business development activities. Revenue and profit is shared between both parties with no limit on what can be earned.