Greene King has revealed plans to potentially divest 150 of its pubs and convert another 150 into tenanted establishments. The company has identified 300 sites that could benefit from alternative operational models. The specific locations at risk have not been disclosed, but Greene King assured that these pubs would be transitioned to a new dedicated business unit.
Additionally, Greene King disclosed that a small number of sites, less than 2% of its managed estate, are earmarked for closure. The company manages approximately 1,500 sites under various brands, including Greene King pubs, Hungry Horse, Chef and Brewer, Farmhouse Inns, and Flaming Grill. In addition, it oversees 1,000 leased, tenanted, and franchise pubs.
The strategic restructuring is aimed at generating funds from the pub sales to reinvest in core establishments and launch a £35 million digital initiative to enhance customer loyalty. CEO Nick Mackenzie expressed confidence in this new approach, emphasizing its alignment with evolving consumer behaviors and the dynamic business landscape.
The move by Greene King coincides with the government’s announcement of a 15% reduction in new business rate bills for struggling pubs as part of a comprehensive support package. Treasury minister Dan Tomlinson confirmed that this relief would take effect from April, with a freeze on bill hikes for pubs for the following two years. Furthermore, the valuation model for pubs will undergo a review.
Moreover, under licensing reforms, pubs and other licensed venues will have the opportunity to extend their opening hours beyond midnight during the later stages of this summer’s World Cup matches. The industry has been rallying for support, with initiatives like the Your Pub Needs You campaign by the Mirror advocating for landlords and their communities.
Industry stakeholders and MPs have voiced concerns over impending tax increases and the elimination of Covid-related discounts, warning of potential closures. Pubs are bracing for increased bills due to upcoming changes in business rates and the phasing out of pandemic concessions as outlined in the recent Budget announcement.
This comprehensive strategy by Greene King and the government’s support measures aim to navigate the challenges faced by the pub sector and ensure its resilience in the evolving market landscape.