The drinks won't need to be quite as stiff for Punch Taverns' (PUB) shareholders if its revised strategy goes to plan. The new face behind the bar, chief executive Duncan Garrood, who joined in June, has moved to introduce three new operating formats besides its 'wet rent' option, which compels publicans to buy its stock from the brewery. This model is under pressure from legislation including a 'market rent only' option that effectively unknots the age-old beer tie.
Mr Garrood said 31 of Punch's pubs had already adopted the 'retail contract' option, whereby the company retains all the sales and cost of sales but pays the publican a percentage with which to remunerate staff. This model means Punch also takes responsibility for back-of-house administration, freeing pub managers to focus on their customers. Mr Garrood claimed the switch had already yielded results, with sales up 15-20 per cent in those pubs operating under the system. He expects 100 pubs to have opted for retail contracts by August 2016.