Thinking Of Buying A Pub? What You Need To Know

Enjoying a refreshing cold pint in the pub after a long day of work is the activity of choice for many Brits. So, it’s perhaps little wonder that owning a pub is the stuff of dreams, especially since doing so means waving goodbye to the 9 to 5 in the sweetest of ways (barring winning the lottery of course).

For those about to embark on the journey of public house ownership, it’s wise to fully research what’s involved. While we’re keen to promote a glass that’s literally half full of your favourite spirit here, knowing what to expect in terms of costs and commitment is more likely to lead to a successful outcome.

So before you say ‘cheers!’ to your new investment, here’s what everyone who is considering buying a pub needs to get to grips with first.

Research Your Target Market

Pubs might be a place to kick back and relax in, but they are a business like any other. Therefore, would-be pub owners need a clear idea of who their target customers are so that the appeal of their pub will align.

To undertake such a task, many publicans suggest spending a decent amount of time in any pub before purchasing it. Such difficult yet essential market research will allow you to get a feel for the type of customers the pub attracts, and most importantly how customer levels fluctuate during the week.

If the pub doesn’t seem to be doing a fair amount of trade, you need to ask yourself why, and whether this is something you can fix or not. On the other side of the coin, if locals are happy with the pub and it’s doing a roaring trade, coming in and making huge changes could prove to be a costly mistake for your business.

As well as the typical demographic of your customers, also consider that the type of pub (i.e. country pubs, city centre pubs and family friendly pubs), will determine the clientele that needs to be catered for.

Create A Business Strategy

At present, there are fewer pubs in England and Wales than ever before, which is why having a solid strategy for your business is key.

Thankfully, there is no doubt that pubs remain a popular venue of choice for social gatherings, family functions and big sporting events. However, challenges including Brexit, the pandemic and the rising costs of living have all presented major hurdles for the pub trade.

A basic idea of costs need to be drawn up to identify if the pub is affordable, and how it will make a profit. This includes factoring in the basic costs of stock and labour, along with ongoing costs such as taxes and accountancy fees. For pubs in need of an overhaul, the cost of renovation work will also need to be weighed up too.

While a pint may be in order after reading all of that, the reality is that if a pub is to stay afloat amongst the backdrop of so many challenges, the finances must make sense.

Make An Offer And Agree Terms

Once you know your financing and business strategy is viable, it’s time to make an offer on your chosen pub. Depending on how the project is being financed, the building may require a valuation to ascertain its value before signing on the dotted line.

Ideally, a solicitor who is experienced in the public house trade should be consulted, so that they can navigate many of the nuances that are unique to the industry.

An offer can then be formally made, and if accepted, you’ll be the new owner of the pub. Licensing agreements can then be put in place so that you can legally trade under your name.

Getting Ready For Opening

For those who have successfully run a pub before, the transition from purchasing to officially opening may prove easier than those who are new to the trade. Either way, it’s always a good idea to work with the current owners, so that you can get to grips with how things operate in that location specifically. Use the time to ask plenty of questions, and iron out any details you’re unsure of. If the pub will be closed due to renovation works or staff training before reopening, remember to tell your customers. A marketing campaign will then need to be put together to get punters through the door as soon as you reopen.

Even if you aren’t planning on closing the pub, it’s still a great opportunity to introduce yourself to your customers through an opening night, or similar deals and promotions you may want to run to attract attention.

Although running a pub is hard work, now is the time to enjoy achieving your ambition as it finally becomes a reality.

Pub Buying FAQs

How Much Does It Cost To Run A Pub?

While all pubs differ in terms of size, location and general turnover, Greene King states the average pub costs around £3,000 per week to run. Over the course of the year, this would amount to £156,000. Running costs include rent, food and drink stock, staff, maintenance, licence fees, pub insurance and more. Having a solid financial plan before purchasing your pub will ensure your running costs can be covered, including balancing quieter times of the year.

I Want To Run A Pub But I Have No Money - Is It Still Possible?

Absolutely, it’s possible to run a pub without owning one if you have an appetite for the management side of the business. Although you’ll need to be prepared to work your way up through the junior ranks first, which could take several years.

As part of your experience, you’ll need to master both the customer side of the business as well as all the administrative tasks.

Assistant manager roles often have an 18 month mentorship attached to them, allowing you to progress to a general manager role. Above this level, area managers oversee several pubs at once.

If you can manage to save up some cash in this time, it’s also possible to rent a pub, which will cost significantly less than purchasing a pub.

How Much Rent Should I Pay For My Pub?

Looking to rent rather than own a pub? Typical rents for pubs in the UK are around £30,000 to £50,000 per year, although a small fraction of pubs do cost £100,000 and above per year to rent. The aptly named Pubs To Let has pubs which are available to let in the UK, starting at around £20,000.

Can I Buy A Pub And Live In It?

Yes, if you are also going to be running the pub. Some sell their home to be able to buy a pub, and moving into the upstairs accommodation makes logical sense, especially as it also reduces the need to commute.

Living in your pub will mean you’re on hand to properly manage it, or at least oversee your management team if you’ll be hiring additional staff.

If you are instead looking to buy a pub and turn it into a residential residence rather than keep it as a pub, you’ll need to seek planning permission to determine whether this is possible or not.