Saturday, 11 January 2014

Market forces at work

Not far from me there’s a branch of ALDI which has become so popular that at busy times they’re queueing to get into the car park. This demonstrates the widely-reported trend that discount supermarkets have been booming while their mainstream competitors such as Morrisons and Tesco have seen a decline in sales. MP Douglas Carswell argues here that this is a good example of the free market at work, with new competitors coming in and challenging the established players.

I was musing to what extent the rise of Wetherspoon’s is a parallel in the pub market. To some degree it is, with them have come from nowhere to be a powerful force, and putting value for money at the forefront of their offer. However, on further consideration I would say it is really more like the original growth of the big supermarket chains – applying a consistent format to all their stores and using bulk buying power to drive down prices and undercut a miscellany of independent competitors.

While the erstwhile Big Six brewers acquired massive tied estates and often applied insensitive corporate design identities, they never did anything like the same standardisation of how their pubs were actually run. Most, of course, remained tenancies which are essentially independent businesses, but even in their managed divisions they never really sought to roll out a single formula across huge numbers of pubs. In general, they promoted their beer, not their pubs. The one exception was in dining chains like Beefeater and Brewer’s Fayre, but even the biggest of these never got beyond the low hundreds.

Indeed, Wetherspoon’s formula of applying basically the same trading format to what is now nearly 1000 pubs from Penzance to Wick is an entirely new innovation in the pub business, and one that has so far proved extremely successful. They don’t tend to do mass-media advertising, but by now pretty much every pubgoer must know what to expect from a Spoons. Yet nobody has come remotely close to copying them – the Goose chain originally started by Bass being the best-known attempt – and they have now become so large that any me-too competition would stand little chance of success.

It’s interesting to reflect, though, that the current Wetherspoon template didn’t emerge fully-formed from the outset. Initially, they were very much London and South-East based, and it wasn’t really until the mid-90s that they began to expand outside that area. The very first Spoons I encountered was the Bell in Norwich in the Spring of 1995, and their first pub in the Greater Manchester area, the Moon Under Water on Deansgate, opened later that year.

In the early years, while always offering decent value, I don’t recall them having the reputation for cutting-edge prices that they later acquired. And it’s only relatively recently that they have turned themselves into mini beer exhibitions. In the early days their beer range tended very much to major on the usual suspects from the bigger independent brewers, and initially the staple cask beer was Younger’s Scotch Bitter. They key selling points at first were that they were clean, served real ale, had no music, were open all day and served food all day – a combination that in those days was very hard to find, especially in London where the Big Six had large numbers of pubs that seemed to be run with a take-it-or-leave-it attitude.

8 comments:

  1. Consistency is definitely a valuable thing.

    If you have a family and you're on a day out, you get hungry kids. You want somewhere where you know you're going to get good service, and are going to cater for families. It might not be as good as a local freehouse, but on the other hand, the local freehouse might be terrible.

    So, we don't take the family into a 'Spoons locally for food as we have some great local food pubs, but when in a strange place, it's a familiar name that always delivers something that's fine.

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  2. Its a British disease, we'd rather go somewhere we know will be mediocre than take a chance with someone that might or might not be fantastic.

    and what crappy lives we have made for ourselves with this pathetic cowardice; identikit town centres with the same 20 chains up and down the country, boring and unfulfilling McJobs.

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  3. It is perfectly rational decision, with no hint of cowardice, to settle for adequate than gamble at long odds on excellence. Especially when funds are limited.

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  4. Wetherspoons tend to clutter town
    and city centres where nearby pubs have been decimated in recent years,. The relative success and survival has been dependent on the elimination of competition aided by state interference and regulation.
    We can compare with the runaway success of dives and speakeasys
    following the state prohition of alcohol in the USA
    Simply put,Wetherspoons has capitalised on the State induced
    annialation on the working class local,somewhat akin to the early Soviet (1917-25)demolition of the bar/tavern sector in Russian cities and towns.
    Isolate the individual,rule without mandate,easy.

    Observer

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  5. I'm pretty familiar with the offer of every pub within a mile's radius of the Spoons in Stockport town centre. It's not the best pub by a long chalk, but on a variety of counts, most notably a wide range of good-value food, it may well be the best bet in some circumstances.

    For someone wanting a decent pint and a bite to eat, I don't think for the most part these potential "hidden gems" exist.

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  6. no I think the hidden gems certainly exist, but thats the point they are hidden :) and its whether you stand a hope of ever finding them, or just happening across them by chance. Spoons for all the faults people tend to chuck at them, are generally fairly easy to find.

    and although I dont like to say they are all alike, because I dont think they are totally, there are some very good ones, some in the middle and some you dont want to spend a great deal of time in, and the same pubs can really go through all that range in a surprisingly short time frame. but ultimately you know what to expect on the food, beer & cost front, and if its not 5 star dining and best beer in the world,well you havent just spent £10 on a burger as some pubs like to charge.

    the surprising thing as you say is how come no-one has really tried to copy what theyve done.

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  7. I go in Spoons hoping to avoid beardy weirdies, thinking they will all be in the multi beer freehouses or traditional locals.

    I am hoping to hear the wailing of children whilst I eat a cheap donkey burger that's been gourmet'd up with bacon, cheese & gook. All safe in the knowledge that the beards are far away.

    What do I find? The gaff is full of beards, all using up their beard club coupons. Get in the proper pubs, beards! Leave our spoons alone. Leave it for us norms!


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