Marston’s to ring changes for landlords
PUB company Marston’s has won approval from the British Franchise Association to changes its tenancy agreements, giving the group more influence over how individual landlords run its pubs.
Marston’s has been offering its retail agreements to it tenants since 2006, with 230 of its 1,600 pubs now run under the scheme.
The deals mean that Marston’s gets a share of the pubs’ revenues in return for supplying them with food and drink, choosing entertainment licences and dealing with refurbishments.
It’s a big change to the traditional relationship between a landlord and brewer, where beer is supplied to the tenant and the owner receives rent, without input into management.
“The Retail Agreement is proving to be an appropriate and successful response to the challenges faced by many operators in the tenanted pub industry,” said Marston’s chief executive Ralph Findlay. “It encourages entrepreneurialism among licencees.”
Analysts reacted positively to the news, saying that the approval should help the company attract more high quality people to the model, which gets three times more applicants than the traditional tenancy.
“The Retail Agreement is Marston’s solution to the legacy issue of a large tenanted estate,” said analyst Paul Tucker at Peel Hunt.
“Accreditation highlights that this is a viable business model, significantly different to traditional tenancy.”