[s8s8discourse]

There isn't sufficient margin in drink to float a pub. The margin is in food (and to an extent, dispensed soft drinks).

Because priority becomes food over drink, people are willing (and able) to drive further for a better pub. Competition increases and you don't need a 'local' for every village or part of town anymore. Less pubs can serve more people because rather than regulars "propping up the bar" 3-5 nights a week for an extended session, you get restaurant-esque table turnover.

This is desirable for landlords - they often live above their pubs - profit from food service means you can shut earlier, you don't have regular fights or trouble from drunk customers and general toil is lower.

But some publicans just won't (or can't) adapt. They won't or can't invest in kitchen and chef. They can't or won't learn how to market and attract new, younger customers. Inflation, energy pricing, COVID shutdowns et al have all just accelerated the demise of the "pub pub".

The old "pub pub" crowd are now well served by the Wetherspoons, who have the advantage of controlling their margins in ways Brewery landlords can't compete with (mass purchasing, pre-prepared food, all their pubs are "new" buildings that don't have the insane maintenance and insurance overheads of a 200+ year old pub building etcetc).

We may be at a record low, but I suspect we'll be setting new lows for some years to come yet.

src: family of publicans from 193Xs ~> 200X. Tried to buy a pub at the 'end' of COVID restrictions.

[tamade]

Having invested in this business before, the margin is entirely in alcohol. Typical drink costs <50p and sold for >20x. Food has nowhere near those margins given the labor and materials required.

[sen]

Yeah no idea what that part is about. The margins are absolutely in the alcohol, and the food is to get you to spend longer sitting there drinking with friends.

Src: Ran a bar for 4 years.

[safety1st]

Some pubs successfully transition into a sort of trendy, highly publicized concept restaurant which charges a premium for food and essentially attracts well off restaurant customers who tend to drink more than average. I think that might be the model he had in mind. Most pubs won't be able to do this however as the market for it is only so big and it will tend to alienate their regular customer base.

[bko]

Doesn't it depend on the absolute amount of profit per customer per hour?

For instance, if a person goes out and has 3 beers over two hours at $6 each, say the profit is $5 per beer or $15.

Instead if that person comes in and orders a meal for $30, with a 50% margin, he's made the same amount and likely didn't stay as long. Basically food is more absolute profit per customer per hour. And you get the benefit of not dealing with drunk people. That's why they they often don't let you take a table if you're not ordering food.

[oneoff786]

A 50% margin on a meal is enormous. Expect single digits. Food requires someone to cook it, a lot more storage, a lot more tools and dishes and what not.

[willcipriano]

I've worked in serval bar kitchens where the food was a loss leader and basically only there to allow the business to more easily aquire a liquor license.

[bko]

Fair enough. The customer may order some soft-drinks or alcohol drinks at the bar. Also I hear deserts are high margin. My point is that relative margin is not the thing you would want to optimize on. You'd want to maximize profit per customer per hour.

[safety1st]

His point still stands. Your original estimate of the margin was just not realistic.

This obviously varies depending on many factors, but when you factor in labor, ingredients, equipment etc. 10% is a good margin on food. In your hypothetical example the customer who came in, had a meal and nothing else, and then left earned the pub $3 in profit. Someone who has a few drinks in the same amount of time will usually generate more profit.

[photoGrant]

Having lived and grown up in this business (above a pub since a child) -- you're right.

[jimjambw]

Not saying I don't believe you but why would a Brit leave out the 'u' in labour?

[martinald]

A bit OT but American English is becoming very popular over here in the UK. It's very common to see z instead of s in words for example. I wouldn't be surprised to see the u dropped at all.

[brigandish]

"z" has been a valid alternative to "s" since I was a boy (and I can no longer claim to be a spring chicken).

What I have noticed more of is children saying "zee" instead of "zed". I beat those children and they come to realise that they deserve it.

[MikeTheGreat]

I grew up here in the US saying "zee". It's only now, in my wiser years, that I'm realizing the obvious: with "bee", "cee", and "dee" (amongst others) all sounding similar-ish already that we really ought to embrace "zed" for clarity.

Or we could all memorize something like the https://en.wikipedia.org/wiki/NATO_phonetic_alphabet, I guess.

[pessimizer]

Why add another consonant to the name of a consonant? Literally the only letter that's like that.

Americans and the British (and a couple billion other people) share a language that is spelled like shit. We should steal simplifications from each other as much as possible.

[brigandish]

I think you missed a few, and it's not just consonants:

Ay, see, ef, jee, aitch, aye, jay, kay, oh, kyuu, yuu, double-yuu, eks, why?, zed.

It's because the English alphabet is not a phonetic lettering system. If I were American I'd:

a) start saying "t" in the middle of a word as a "t" instead of a "d", and

b) vastly improve the standard of my spelling and those around me

before telling anyone, especially British people, that words shouldn't be spelt "like shit".

Personally, I'm with the Arguments against reform section of Wikipedia[1]:

> English is a West Germanic language that has borrowed many words from non-Germanic languages, and the spelling of a word often reflects its origin. This sometimes gives a clue as to the meaning of the word. Even if their pronunciation has strayed from the original pronunciation, the spelling is a record of the phoneme.

Which is how I can usually guess the correct pronunciation and meaning of an unfamiliar word while I see highly educated Americans butcher the pronunciation of anything outside the common vernacular. These "simplifications" are doing anything but.

However:

> Another criticism is that a reform may favor one dialect or pronunciation over others, creating a standard language

If I could force North Americans to speak better then I might be persuaded.

[1] https://en.wikipedia.org/wiki/English-language_spelling_refo...

Edit: an important point was missed!

[CydeWeys]

I'm an American, but I use "zed" over "zee" in some contexts (such as ham radio) because "zee" is too easily confusable with the other letters it rhymes with: bee, see, dee, gee, pee, tee. It's definitely an advantage. And you don't have to drop into NATO phonetic with its multiple syllables per letter.

[wincy]

More people in the world say “zee” than “zed”. I’m surprised to hear a British person wants to sound like they’re French. (I’m just kidding as I hope you are about beating children)

[hinoki]

Are you sure? I think they say zed in India, Pakistan, and Bangladesh. That’s quite a few English speakers.

[brigandish]

Thanks to India, more people in the world say "w" like "v" but I feel safe knowing that Indians have a better accent and better spelling than anyone in North America, and I would never joke about anything this serious.

;-)

[mixmastamyk]

Most “American” spelling came from Britain originally.

[User23]

Soccer for example is English slang from back when.

[jen20]

An abbreviation of “association football”.

[epicureanideal]

Maybe adapting to internationalized (American at this point) English.

Also, what they say is what I’ve heard anecdotally several times and it makes sense when comparing even retail prices vs per drink prices.

[brigandish]

> Maybe adapting to internationalized (American at this point) English.

I suggest that in the highly unlikely event this is true that we (the rest of the properly educated British) hunt this person down and dispose of them. After imposing a number of spelling tests first, of course.

[RupertEisenhart]

As an expat Brit who has been living with ESL speakers for over a decade and gotten sloppy on many of these things, some part of me lives in constant fear of exactly this eventuality.

Ain't been caught yet tho

[brigandish]

We are watching…

[thaumasiotes]

One obvious theory is that 'tamade' never learned British English; the username appears to be Chinese.

I doubt you're required to be a British national in order to invest in British pubs.

[seanmcdirmid]

Tamade doesn’t sound in anyway like a Chinese username (maybe Japanese phonetically, but that could easily be a coincidence), but I would let them speak for themselves.

[umanwizard]

It is Chinese: https://chinese.yabla.com/chinese-english-pinyin-dictionary....

[thaumasiotes]

> Tamade doesn’t sound in anyway like a Chinese username

Context is pretty much everything; the only Chinese username I can more or less reel off from memory is '基妮真特么老油条... sabibibi', and I may be forgetting parts of it, but certainly there's plenty of swearing.

[david_allison]

'colour' isn't a valid CSS property, and 'serialisation' is inconsistent within a codebase written by Americans.

Over time it's natural to drift towards en-US spellings when conversing online, even with a spellchecker.

[tamade]

Never said I was a Brit :P In fact, a big chunk of UK pubs are owned by global PE funds.

[brudgers]

And a good kitchen is 40% of the total floor area of a restaurant.

[ludston]

Not that I can claim to understand the business model at all, but usually people that buy food are buying drinks too. You ought to happily make a loss on food if it is guaranteed to be exceeded by increased drink sales.

[toyg]

That's how it used to be, but from what I understand, cheap alcohol from supermarkets has shrunk volumes to levels where overall profits are thinner than in food.

[jhugo]

That's not the case; the vast majority of a pub's margin still comes from alcohol. GP comment is just wrong.

[bavent]

Wow, this is complete opposite of America. I have run several bars/restaurants and most of our money came from alcohol sales. Food was still profitable, but much tighter margins. A lot more labor goes into the food side of the business too, and we couldn't get away with marking things up 4x like you can with wine.

I think as you get into Michelin-starred places, the name of the chef and the quality of the food is enough to allow you to charge more, and also to cheap out on labor - some of the top restaurants in Chicago collude to pay their cooks $10-12/hr, for example.

[heavyset_go]

I was under the impression that margins on alcohol were huge. At least where I am, proprietors trip over themselves to get alcohol licenses, and those licenses go for hefty premiums.

[bavent]

They are - usually a place will charge 3-4x, sometimes 5-6x depending on the type of liquor and brand, what they paid for the product. You lose a bit to labor if you're making craft cocktails, as there can be a lot of prep behind those. Having a good wine list usually means have a sommelier or wine steward who will get paid a bit more than the rest of the serving staff. But for the most part the labor costs for front-of-house are nothing ($2.13/hr in a lot of states) compared to the cooking staff.

[browningstreet]

I have a friend who owns a popular bar and a popular coffee shop. He says he makes far more profit off the coffee shop (which has baked goods and sandwiches and salads) than the bar. Might be different in disparate places.

[ransom1538]

"I wish I had opened a bar" - every restaurant owner I have met.

[algorias]

I'd think those low wages are also partly explained by the desirability of working at a top place (good for your CV and for acquiring actual skills). Pretty similar to how the game industry attracts talent out of proportion to the monetary compensation they pay.

[bavent]

They're 100% explained by that, not just partially. At all of the top-rated restaurants in every city I've cooked in, all the chefs are buddies. It's very common for there to be a tacit agreement to just not pay more than $X, that way they can all keep labor costs down.

[throwawaycuriou]

do you have any sourced examples for this collusion?

a friend of mine bailed the craft after being offered minimum wage and a 60 hour requirement in the kitchen of a Michelin star restaurant in NYC

[bavent]

It's me, I'm the source. I worked in a lot of those Michelin-starred places in quite a few cities.

I also bailed. The pay and hours were a large part of it. But I did it for years and years.

[throwawaycuriou]

has there been any attempt to pursue this legally?

[hn_go_brrrrr]

Are the chefs also the owners or managers?

[bavent]

In a lot of the Michelin places, usually the chef will have a stake in it. To get investors behind them, they usually already have a name and bit of cachet and also worked for other Michelin-starred chefs. The ones I've worked at have varied from "celebrity chef, never actually in the kitchen, everything is actually created by the chef de cuisine and sous" to "micromanaging psycho" to "humble dude who just wants to make good food." So it varies - some manage every aspect of it, but usually there is a dedicated team for the front-of-house and the chef just does the creative side of the food, collaborating usually with his chef de cuisine and sous chefs. CDC and sous handle the day-to-day stuff like ordering, inventory, scheduling.

[benbristow]

> The old "pub pub" crowd are now well served by the Wetherspoons, who have the advantage of controlling their margins in ways Brewery landlords can't compete with (mass purchasing, pre-prepared food, all their pubs are "new" buildings that don't have the insane maintenance and insurance overheads of a 200+ year old pub building etcetc).

Bit untrue on your last statement. Wetherspoons have a habit of occupying traditional/landmark buildings. For all the negative they do against the independent pub trade by outpricing with their brewery deals they do a cracking job in preservation by using & maintaining old buildings that would otherwise go to ruin.

Just in Glasgow for example you've got The Counting House (George Square) which was an old premises of the Bank Of Scotland in the late 19th century and The Crystal Palace also built in the 19th century which houses one of the oldest lift/elevator installations in the UK.

[toyg]

whetherspoons don't have "habits", they have corporate strategies. If they think they need a marquee building in a given area (typically to achieve a higher degree of brand acceptance, or to disguise), they'll occupy an old one; if they don't, they'll happily go for a recent build. They don't have values or habits, they are only interested in what makes them money.

In my neck of the woods (NW England), most Wetherspoons are in new buildings, except in the city centre. Not that it makes any difference to me: I have not stepped in one since it became very clear in 2016 that the owner is a racist piece of work.

[KennyBlanken]

> There isn't sufficient margin in drink to float a pub. The margin is in food (and to an extent, dispensed soft drinks).

In the US, the exact opposite is true. Alcohol sales are where the money is made (and yes, soft drink sales, but there's usually far less of that in an actual bar.) Food has nowhere near the profit margin. Multiple restaurant owners have told me this for years.

Why is it the opposite in the UK?

[smcl]

The food in many of these pubs is of very low quality and is designed to be quickly prepared (reheated) at scale with no complex steps involved. After a short time in the UK you can quickly tell what sort of food you can expect in a given pub, so I think most Brits know what they're getting. Personally, I think this (plus the fact that a large amount of the population take pride in enjoying shit food) give the UK a bad reputation re food.

And you'd actually be surprised how much soft drinks are served in pubs. They're very low wastage - so if your company budgets that X% will be lost for some reason, you'll very likely undershoot that and have only X/2% wasted. Additionally you can adjust the syrup/carbonated water mix so that your margins for each serving are higher. The dodgy pub I worked at as a student frequently used soft drinks as a way to balance stock in case of wastage (or in the case of a corrupt assistant manager, theft). Towards the end of a given stock-keeping period (monthly?) we'd often be told something like "Tennent's is down, ring it up in the tills as 3 small diet cokes" - meaning that there is less of a given beer in the stock room than expected when accounting for how much we ordered and how much we sold, and to correct for this we'd use take advantage of the surplus of coke stock (after a price adjustment) to try to counteract this. God help you if anyone asked for a receipt and accused you of swindling them ...

[SoftTalker]

Why on earth would you do this rather than expensing the missing beer and trying to figure out why it happened? I.e. who is walking out the back door with it?

[smcl]

See my other comment, there was for some reason an incentive to NOT account for this. It seems stupid now that I’m out in the real world, but when you’re making £5/hour:

- you don’t really feel empowered to challenge this sort of thing

- stock or till shortfalls of small amounts like £20 that are threatened to come out of your paycheque feel much more serious than they were, especially when you’re a student in an expensive city and that £20 feeds you for a week

- the reason it happened is often known, there’s just a reluctance to account for it correctly. We are taking about very small amounts here

[CydeWeys]

The people doing this are clearly getting one over on the owners. It's common for pub employees to swindle the owner.

[smcl]

We weren’t swindling anyone :-) The manager of the pub (or I guess the licensee?) was the one telling us to do this. And the reason they’d do this is because the pub was part of a group of pubs, and there were incentives for the managers to hit wastage targets. So if there was a shortfall in some beer (like some somehow wasn’t usable, or there was a fuckup when switching a keg that caused the first 5 pints or so to be pure foam, or on a busy night on a big round you’d incorrectly ring something up without noticing) they’d try to recover that this way.

There wasn’t much theft that I was aware of, other than one assistant manager (who was constantly accusing us of stealing) was caught red handed stealing stock, but that was whisky or rum which wasn’t part of this iirc (when entire bottle goes missing, that really sticks out - very stupid man)

[lmm]

Plenty of pubs competing with each other, and the pub culture is one of sitting and drinking slowly. A US bar is to a pub what McDonald's is to a restaurant - a very different business model that relies on pushing people through quickly.

[vinay427]

I’m not sure what US bars you’ve been to, but I definitely haven’t seen anywhere near that level of difference to a pub in the UK. There’s often more of a focus on food and meals in a pub than a typical bar that’s branded as a bar, but both seem to encourage longer visits, pubs slightly more so.

[ascorbic]

It's not. I'm not sure where OP got that idea from. The margin is in alcohol in the UK too, in pubs but also in restaurants.

[anitil]

In NSW (a state in Australia) a bar/pub is often just an excuse for a poker machine license, with all the actual revenue coming from gambling

[workingon]

This is so strange, and the exact opposite of America. In America margins on drink are 100-200%+ while margins on food are much less when you take into account untipped workers fixing it. It must be the tipping difference, since bartenders are basically free labor in America.

[jhugo]

It sounds strange because it's just false. The vast majority of the margin in UK pubs comes from alcohol sales. I've worked and invested in the industry and it would be a very very unusual pub where this was not the case.

As an aside, this is classic HN: very authoritative sounding comment, voted right to the top, spouting complete nonsense.

[rossriley]

There does need to be a little nuance though, since the vast majority of pub owners are actually on a wet lease then the pub itself doesn't get all of the margin, the breweries normally take 20-25% of that margin.

So an example from a recent wholesale catalogue, 1 30L keg which you can probably sell 58 pints out of will cost around £150 so that gets your cost price of around £2.58 / plus VAT and beer duty and you're up to cost price of over £3.00 / pint

So margins are variable but as you can see if you want to sell at around the average price around the country which is £4 / pint then you're not talking about a massive margin.

The reason why food is a popular option for bar owners is that the breweries don't take any of the margin so the owner takes all the profit from food sales, plus in many ways, the food is extra income from people that would be taking up the space to drink too.

[trollied]

Yeah, I was thinking the same. A large proportion of uk pubs are leased by the likes of Star (Heineken), Punch, Enterprise etc, and they really do screw their landlords on alcohol ties. Free houses basically procure alcohol at 1/2 the price. Food GP is much better in these pubs as a result.

[jhugo]

This is a fair point — I have never been involved with, nor really patronised, tied houses, so I know less about the economics of them. The alcohol is still far more profitable than the food regardless; it's just that in a tied house a significant chunk of that profit is being taken by the pub company.

[seanmcdirmid]

Strange. In the USA, many restaurants barely break even on food and make up their profit on alcohol drinks. They live and die by their liquor license. Is it because they go for pricier drinks in the states?

[toyg]

A lot has to do with alcohol prices outside pubs, i.e. supermarkets and shops, as well as taxation levels.

[monk_e_boy]

I work in post 16 education. The number of young adults who have never had a drink is crazy high. A lot of them just don't drink, don't go out much and haven't ever been to a pub.

Covid. Lock down. Being fucking skint. Not having access to a car or bus service (remember the old days when a mate would drive 7 or 8 of you and your mates to a local for a skin full? Doesn't happen any more)

[sudosysgen]

As a young adult I just don't see drink as much fun to be quite honest.

[ransom1538]

" There isn't sufficient margin in drink to float a pub. The margin is in food (and to an extent, dispensed soft drinks)."

Lol. Try a simple experiment. 1) Pour me a beer. 2) Make me a steak dinner. Task: Find out which takes an entire cooking staff, dish washers, grills, linens, produce, deep freezers, meat bills, gas bills, .... OH! Medium rare please.

[astrange]

Note “landlord” doesn’t mean the same thing it does in the US, it means the person who actively operates the pub.

[oneoff786]

Do they not own the land and building?

[rossriley]

Not any more, the majority are owned by the brewery groups and leased to the landlords.

If you see an independent pub in the UK it will be labelled as a 'Free House' that means it is independent of a brewery and can sell any beers it likes.

[M2Ys4U]

Even pubs that are free of tie don't necessarily own the land/building, they'll lease it from a property company (usually one specialising the hospitality).

[oneoff786]

I would imagine that’s raised prices by a lot then

[astrange]

Traditionally they did but it’s not required. It’s like if you called property managers landlords whether or not they actually are one.

[lmm]

Not necessarily. A pub landlord and a property landlord are completely separate concepts. Of course the same person might be both.

[yodsanklai]

> The margin is in food

Interesting, I've always been told than margin was in alcohol (esp. in high end restaurants).

[toyg]

Restaurants and pubs, despite recent convergence, are in different markets. Restaurants rely on turnover, pubs on repeated orders.

[kman82]

Repeated orders are turnover. Same thing.

[nly]

My local pub does the best burgers I've ever eaten. Absolutely phenomenal. Stone baked pizzas as well.

I'd go there for food with my partner, say a Sunday lunch, but I'd never go there just to drink. I can't think of anything more boring.