| KN5202 |
| KEY NOTE PUBLIC HOUSES : MARCH 2003 |
| Overview |

Editor: Jenny Baxter
ISBN:
1-84168-379-1
This report covers: theme pubs, food pubs, family pubs, Irish themed pubs, superpubs, traditional pubs, industry regulation,brands,managed houses, tenanted pubs, free houses, retailing, cafe bars,brasseries, sports bars,drinks outlets,alcoholic drinks,pubs,public houses,breweries,drink,brewers, Licensing laws, European Legislation, Smoking in Pubs,
Companies/brands covered include: Enterprise Inns, Punch Taverns, Unique/Voyager, Pubmaster, Scottish & Newcastle, Six Continents, JD Wetherspoon, Whitbread, Greene King, Wolverhampton & Dudley Breweries, InnSpired Group, Avebury Taverns, Scottish & Newcastle, Interbrew, Coors Brewers, Carlsberg-Tetley, Regent Inns, SFI group, Yates Group
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| 1. Market Definition 8 |
| REPORT COVERAGE 8 |
| DEFINITION OF A PUB 8 |
| The UK Licensing Laws 8 |
| Characteristics of a Pub 9 |
| THE TIED-HOUSe SYSTEM, THE BEER ORDERS AND THEIR AFTERMATH 10 |
| The Tied-House System 10 |
| The Beer Orders and After 11 |
| Table 1: Key Dates In Brewing History Since the Beer Orders, 1989-2001 11 |
| MARKET SECTORS 13 |
| By Ownership and Management 13 |
| By Geographical Location 14 |
| By Theme or Brand 14 |
| Food Pubs and Pub-Restaurants 15 |
| MARKET TRENDS 15 |
| The Rise and Rise of Eating Out 15 |
| More Precise Demographic Targeting 16 |
| Influence of Drink Market Trends 16 |
| MARKET POSITION 17 |
| The UK 17 |
| The Pub as a Licensed Premises 17 |
| Other Market Positions for Pubs 17 |
| Overseas 18 |
| 2. Market Size 19 |
| INTRODUCTION 19 |
| THE TOTAL MARKET 19 |
| By Value 19 |
| Table 2: The UK Public House Market and Other Consumer Catering Markets by Value (£m), 1998-2002 20 |
| The Product Mix 20 |
| Table 3: The Product Mix in the Average UK Pub by Value (£m and %), 1988, 1998 and 2002 21 |
| Beer, FAB and Cider 21 |
| Table 4: Pubs' Share of the UK Alcoholic Drinks Market by Sector by Value (£bn and %), 2002 22 |
| Other Drinks 23 |
| Food and Other Pub Revenues 23 |
| NUMBER OF PUBS 24 |
| Table 5: Estimated Number of Public Houses and Other Licensed Premises in the UK, 1990, 1998, 2000 and 2002 25 |
| Table 6: Average Value of Sales Through Public Houses (£m, number of pubs and £000), 1998, 2000 and 2002 26 |
| CONSUMER USAGE OF PUBS 27 |
| BY MARKET SECTOR 27 |
| Ownership and Management Sectors 28 |
| Sectors by Target Markets 29 |
| Location and Size 29 |
| Themes and Brands 30 |
| Catchment Area 30 |
| 3. Industry Background 31 |
| INTRODUCTION 31 |
| Recent History 31 |
| Summary of Ownership Changes in 1999-2002 31 |
| 1999 31 |
| 2000 32 |
| 2001 32 |
| 2002 32 |
| NUMBER OF COMPANIES 32 |
| Table 7: UK VAT-Based Enterprises in the Bars Sector by Turnover Sizeband (number and %), 2000-2002 33 |
| EMPLOYMENT 34 |
| REGIONAL VARIATIONS IN THE MARKETPLACE 34 |
| Table 8: Regional Brewer-Landlords With Over 200 Pubs (number of pubs), 2003 35 |
| HOW ROBUST IS THE MARKET? 36 |
| LEGISLATION 37 |
| The Licensing Laws 37 |
| European Legislation 38 |
| Smoking in Pubs 38 |
| Criminal Justice and Police Act 39 |
| KEY TRADE ASSOCIATIONS 39 |
| The British Beer & Pub Association 39 |
| Other Organisations 39 |
| Campaign for Real Ale 40 |
| 4. Competitor Analysis 41 |
| THE MARKETPLACE 41 |
| Brewers 41 |
| Non-Brewers 41 |
| MARKET LEADERS 42 |
| Table 9: Leading Multiple Pub Owners by Number of Outlets, January 2003 42 |
| Enterprise Inns PLC 43 |
| Company Structure 43 |
| Current and Future Developments 43 |
| Financial Results 43 |
| Punch Taverns PLC 44 |
| Company Structure 44 |
| Current and Future Developments 44 |
| Financial Results 44 |
| Unique/Voyager 45 |
| Company Structure 45 |
| Current and Future Developments 45 |
| Financial Results 45 |
| Pubmaster Ltd 45 |
| Company Structure 45 |
| Current and Future Developments 46 |
| Financial Results 46 |
| Scottish & Newcastle PLC 46 |
| Company Structure 46 |
| Current and Future Developments 47 |
| Financial Results 47 |
| Six Continents PLC 47 |
| Company Structure 47 |
| Current and Future Developments 48 |
| Financial Results 48 |
| JD Wetherspoon PLC 48 |
| Company Structure 48 |
| Current and Future Developments 49 |
| Financial Results 49 |
| OTHER COMPANIES 49 |
| Whitbread PLC 49 |
| Greene King PLC 49 |
| The Wolverhampton & Dudley Breweries PLC 49 |
| InnSpired Group Ltd 50 |
| Avebury Taverns Ltd 50 |
| OUTSIDE SUPPLIERS 50 |
| Brewing Industry 50 |
| Table 10: Market Shares in UK Brewing by Value (%), 2002 51 |
| Scottish & Newcastle 51 |
| Interbrew 52 |
| Coors Brewers 52 |
| Carlsberg-Tetley 52 |
| Other Brewers 52 |
| Other Drinks 52 |
| MARKETING ACTIVITY 53 |
| Local Marketing 53 |
| Main Media Advertising Campaigns 53 |
| 5. Brand Strategy 55 |
| INTRODUCTION 55 |
| TRADITIONAL PUB NAMES VERSUS THEMES AND MODERN BRANDS 55 |
| Table 11: Examples of Leading Pub Brands and Concepts, 1995-2003 56 |
| BRAND AND CONCEPT DEVELOPERS 58 |
| Regent Inns 58 |
| SFI Group 58 |
| Yates Group 58 |
| 6. Strengths, Weaknesses, Opportunities and Threats 59 |
| STRENGTHS 59 |
| WEAKNESSES 59 |
| OPPORTUNITIES 59 |
| THREATS 60 |
| 7. Buying Behaviour 61 |
| INTRODUCTION 61 |
| PUB USAGE IN 2002 61 |
| Table 12: Occasions on Which Pubs Are Visited Regularly (% of adults), 2002 62 |
| Demographic Differences in Pub Usage 62 |
| Ordinary Occasions 62 |
| Table 13: Ordinary Occasions on Which Pubs Are Visited Regularly by Sex, Age, Social Grade and Region (% of adults), 2002 63 |
| Special Occasions and Entertainment 64 |
| Table 14: Special Occasions and Entertainment Purposes for Which Pubs Are Visited Regularly by Sex, Age, Social Grade and Region (% of adults), 2002 65 |
| PUBLIC OPINION ON NEW LICENSING LAWS 66 |
| Table 15: Opinions On Changes to the Licensing Laws (% of adults), 2002 67 |
| General Opinions by Demographic Groups 67 |
| Table 16: General Opinions on Pub Licensing Laws by Sex, Age, Social Grade and Region (% of adults), 2002 68 |
| Opinons on Pub Opening Hours 69 |
| Table 17: Opinions on Pub Opening Hours by Sex, Age, Social Grade and Region (% of adults), 2002 69 |
| Opinions on Entertainment Aspects of Licensing Laws 71 |
| Table 18: Opinions on Entertainment Aspects of the Licensing Laws (% of adults), 2002 71 |
| Opinions on Children and Teenagers in Pubs 72 |
| Table 19: Opinions on Children and Teenagers in Pubs (% of adults), 2002 73 |
| 8 . Current Issues 74 |
| MAJOR ACQUISITIONS AND MERGERS 74 |
| CHANGES AT THE FORMER `BIG SIX' 74 |
| NEW LICENSING LAWS 75 |
| 9. The Global Market 76 |
| DRINKS OUTLETS AROUND THE WORLD 76 |
| FOREIGN BEER IN THE UK 76 |
| GLOBALISATION OF BREWING 77 |
| 10. Forecasts 78 |
| Economic Trends 78 |
| FORECASTS 2003 TO 2007 78 |
| Table 20: The Forecast UK Public House Market by Value and Volume (£m and number of pubs), 2003-2007 78 |
| MARKET GROWTH 79 |
| Figure 1: Growth in the UK Public House Market by Value (£m ), 1998-2007 79 |
| Figure 2: Growth in the UK Public House Market by Volume (number of pubs), 1998-2007 80 |
| FUTURE TRENDS 80 |
| Trading in the Early 2000s 80 |
| Licensing Laws 81 |
| Other Future Regulation 81 |
| Leading Pub Owners 82 |
| Drinks Changes 83 |
| 11. Company Profiles 84 |
| ENTERPRISE INNS PLC 85 |
| GREENE KING PLC 87 |
| JD WETHERSPOON PLC 89 |
| Pubmaster Ltd 91 |
| PUNCH TAVERNS PLC 93 |
| Scottish & Newcastle Plc 95 |
| Six Continents Plc 97 |
| the Wolverhampton & Dudley Breweries PLC 99 |
| 12. Company Financials 101 |
| 13. Further Sources 103 |
| Associations 103 |
| Publications 103 |
| General Sources 104 |
| Bonnier Information Sources 104 |
| Government Publications 105 |
| Other Sources 105 |
The UK's 48,000 public houses play a central role in the UK catering and drinks market, with sales of £14bn in 2002. However, the value of the market is static and the number of pubs is declining year on year.
Beer is still the main product sold in pubs, reflecting the historic 'tied house' connection between brewer and publican. Brewers remain important as pub operators, particularly among the regional brewers, but legislation in the 1990s broke up the largest, national estates. Of the new `pub companies' (pubcos) that emerged to acquire the pubs, Enterprise Inns PLC is the largest, with 5,500 pubs at the end of 2002.
Major competitors to Enterprise Inns include Punch Taverns PLC, Pubmaster Ltd and the last remaining national brewer and publican, Scottish & Newcastle PLC. Some smaller companies, such as JD Wetherspoon PLC, have specialised in developing carefully managed pubs, rather than bringing together thousands of independent pubs under supply contracts.
Customers now demand a wider variety of drinks from pubs, e.g. more wine, packaged spirits such as Bacardi Breezer, and various soft drinks, and this is reflected in the different styles of pub now available. The contribution of food to pub turnover is rising every year, and many pubs offer televised sport and other entertainment - in particular, to attract young adults looking for sociable venues.
Looking to the future, the concept of the public house is set to change with the new licensing laws going through Parliament in 2003. These will liberalise opening hours but introduce stricter regulations on publicans and pub premises. Licensing will be moved from the local magistrates' courts to local councils.
Text © 2003 Key Note
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Last updated by Amanda Porteous May 2003