Greene King Pub Company, Background and the House Manager’s Role in a Team-Focused Company
This case study is mainly based on information kindly provided by Greene King. It is the first of three case studies about the company. It includes:
• The history of Greene King plc
• An overview of the Pubs and Bars Sector
• A description of the overall structure of Greene King plc
• The role of a House Manager within the Green King Pub Company, a division of Greene King plc
• The departments and teams that support a House Manager and relationships between them
• A summary
Suggested learning inputs/activities
The contents of the case study are of particular relevance to those level 3 Hospitality, Catering and Leisure qualifications that look in some depth at the structure of the industry and/or require knowledge of different organisations, job roles, responsibilities and lines of communication. Teachers may also wish to use extracts with students taking some level 2 qualifications.
1. Introductory Activity – in groups, using local knowledge
• Make a list/draw up a table of all the pubs and bars in your local area
• In your list/table give the name and location of each pub and bar
• For each pub/bar try to identify a category e.g. local pub, gastro pub, café bar, wine bar, hotel bar etc.
2. Research Activity – teacher hands out/goes through the first 2 sections of the case study (Greene King Background and Features of Pubs and Bars sector), then students continue to work in the same group using the list/table produced in Activity 1, and carry out research using the internet, Yellow Pages, Thomson’s Directory, local newspapers etc. to find out:
• The main products and services offered by each pub listed
• The different styles of the pubs and types of customers each is likely to attract
• Who owns the pub
3. Presentation/written report – group or individual
Using their findings from the first 2 activities, students produce a brief comparison of the features of the pubs in the local area, and try to identify factors that explain similarities and differences (e.g. location, ownership, target market).
4. Greene King: A Team Focused Company – group or individual.
Teacher’s hand out/go through the rest of the case study. Students describe at least four different situations in a typical day for a House Manager and for each situation they have to identify which of the Support Teams can help/will already have helped the Manager to deal with the situation, for example the House Manager’s diary entry for 5 January is ‘plan for Valentines Day’ or on arriving at work the House Manager is told there is a burst pipe in the ladies loo. (Students could then carry out role-plays of the conversations between the House Manager and the Support Team members.)
Case Study (Part One) – The Greene King Pub Company: Background and the House Manager’s Role in a Team-Focused Company
A Brief History of Greene King
The Greene King Pub Company is part of Greene King plc. Greene King’s history in brewing beer and pub retailing goes back over 200 years. Founded in 1799 by Benjamin Greene, it has grown steadily from its base in Bury St Edmunds, Suffolk, to become a leading pub retailer and ale brewer in both England and Scotland. Greene King is a fine example of a company that has developed from a company of regional importance, to one of national importance. This was achieved both through the natural development and expansion of Greene King, and through acquisition of or merging with other companies.
In 1830, when the agricultural economy was in difficulty, the introduction of the Beer Act created a new type of public house - the beer house. Within the first six months of the Act, nearly 25,000 beer houses had sprung up around the country, and beer sales increased dramatically. Competition was fierce and a price war on beer began, however, the company now known as Greene King survived.
In 1836, Benjamin Greene handed over the management of the company to his son. Edward Greene introduced some radical new benefits for the workforce, such as a pension scheme for the elderly and infirm, and better housing for his workers.
In 1887, the well-established Greene’s brewery amalgamated with Frederick King’s smaller St Edmunds brewery to form Greene King and Sons. It became one of the largest country breweries in England and owner of 148 public houses. The new company quickly established a regional reputation for producing two fine types of beers - old ale and bitter. Old ale - very sharp and strong - was a Suffolk specialty and much praised in the region.
During the years of World War 1, the Temperance Movement increased its influence and restrictions were placed on the length of licensing hours and the strength of beers. Greene King’s healthy trading position helped the company to survive and it even acquired other Suffolk breweries during this period.
In 1938, the company opened a long-awaited new brew house in time to meet the World War 2 demands of the Allied servicemen based in East Anglia. Since then, expansion and acquisition have continued. By the early1960s, the company owned over 900 pubs.
Greene King today
In 1990, Greene King and Sons was floated on the stock market to become Greene King plc. A series of acquisitions followed. In August 2004, the company acquired 432 neighbourhood pubs from Laurel Pub Company for the sum of £654million. In March 2006, Greene King consolidated its presence north of the border (8 pubs had previously been bought from Dalgety Taverns in 2002) with the takeover of the Belhaven Group plc, one of Scotland’s oldest and largest regional breweries with 271 pubs and the most popular draught ale sold in Scottish pubs. Belhaven now trades as a separate division of Greene King. This policy of acquisition has turned Greene King into a successful national company and will no doubt be pursued in the future.
Features of the Pubs and Bars Sector
Greene King is an important company within the competitive UK Pubs and Bars Sector. Before looking at the structure of Greene King, it will therefore be helpful to find out something about how this sector operates. It is fairly complicated, but basically there are the free houses, the breweries and the pub cos (independent pub companies that have a chain of pubs under their ownership).
Most of the 81,500 public houses in the UK are owned, managed or leased.
If a publican owns the pub - has the freehold - the choice of beers and drinks sold is his or her own. To own a pub you need to invest a lot of time, energy and money, but the publican is his/her own boss and the rewards can be great.
If a brewery or pub co owns the pub rented by the publican, then he/she is the tenant and is tied to selling the beer and other products made or sold by the owner. Becoming a tenant is a relatively low-cost way of entering the pubs and bars business. Tenants don’t have to find the full amount it would take to buy a pub. Instead they normally need a deposit and, depending on the agreement, a figure to cover fixtures and fittings.
Other advantages are that the brewery or pub co will provide advice on trading performance, and tenants will have access to their marketing activities and to their training programmes, everything from health and safety to hygiene to cellar management.
A tenancy generally lasts for a short period like one to three years, after which it is renewed. Tenants often pay slightly higher prices through an agreement with the pub co/brewery to purchase their products. The mix, though, of assistance for the business and the strength of a group’s brand can more than make up for that.
Here the publican (the lessee) usually has a long lease of between 10 to 25 years from the pub co/brewery. The leases can be sold on. The publican has a greater financial interest in making the pub a success because, by building the business, the lease can be sold on at a profit. A traditional tenancy cannot be sold on.
Managed public houses are operated directly by the company that owns them. Staff can be hired at a particular level, for example as a house manager, chef, bar tender or waiter, and work their way up, and there are wider opportunities with the company, for example in area management, human resources or business development.
Staff of managed pubs get all the benefits of being an employee and possibly perks like on-site accommodation. They can expect a full training programme, including training in the key skills and qualifications they will need to become a licensee. Control of a managed public house, however, is in the hands of the company that owns it, not the house manager.
Greene King is one of the companies that operate an ‘estate’ that has a mixture of managed and tenanted pubs.
The Greene King Structure
Greene King has three divisions:
1. The Brewing Company
This division is responsible for brewing top quality beer, building strong brands and providing best service for a variety of customers - individual licensees as well as pub chains, wholesalers and supermarkets.
The Brewing Company serves around 3,000 free trade pubs, hotels and restaurants as well as national accounts with many of the main pub companies
including its sister divisions of Pub Partners and Pub Company (see sections 2 and 3 below).
The famous cask brands include Greene King IPA (the No. 1 cask ale in the UK), Abbot Ale, Old Speckled Hen and Ruddles County. A new beer to encourage beer back to the dining table has been launched, Beer To Dine For. Belhaven Best has recently been added to the portfolio and is the Number 1 best selling draught ale brand in Scotland although its popularity is growing south of the border.
2. Pub Partners
Pub Partners operates Greene King’s leased and tenanted estates, with over 1300 outlets across England. Tenancies are for 9 years and leases are for 15 years. Premises vary in size, type and situation from community locals to food-led destination pubs, from traditional country pubs to high street venues aimed at the young professional market.
3. Pub Company
The Pub Company is the managed house division of Greene King, with over 800 pubs and 15,000 employees. It is the third fastest-growing managed pub business in the UK.
The Pub Company includes:
Hungry Horse – a national brand delivering value for money and quality in a community pub atmosphere.
Town Local – in prime town centre locations, catering for breakfast diners to the late-night crowd
Inns - distinctive, often period-style accommodation with a focus on great customer service and traditional fare
Real Pubs North & South – based in the heart of local communities with a loyal customer base
With this segmentation of brands, the Greene King Pub Company can appeal to a wide customer base
Working as a Manager for the Greene King Pub Company
A House Manager with Greene King has the freedom to use his/her entrepreneurial skills to take account of market opportunities and to provide what is right for the customer and the business. The manager needs the ability to recognise problems and to identify appropriate and innovative solutions. A budget is allocated to the pub and the House Manager must manage the business so that sales are grown while costs are controlled and profit is maximised.
The manager is also responsible for the recruitment of his/her team, for leading the staff and for inspiring them to give exceptional customer service. The manager must ensure that all staff members receive an induction and ongoing training programme so that their career expectations are met.
This is therefore a wide-ranging role combining interpersonal skills with business ability, and creativity with a strong company focus.
To achieve the position of House Manager within Greene King, applicants must have:
• Successfully managed a pub or hotel that has delivered a minimum of £5K a week sales
• For food related businesses, successfully managed a business that has delivered a 30% split for food and 70% for liquor
• A passion for customer service
• Managed a team of at least five people
• A Personal Licence Holder qualification
• The interpersonal skills to win over their team and their customers
• The commercial ‘nous’ (common sense) and imagination to create their customers’ perfect pub
• Outstanding retailing and marketing skills to make their business the best it can be
• A commitment to nurturing their team’s talents
• ‘Cracking’ organisation and planning skills
• A long term focus on key business development opportunities
• The ability to interpret and manage their Profit & Loss account
Greene King Plc Values
These values are exercised from the executive board through to the people who work in the pubs. They are seen as a way for everybody to have the same work ethics.
Greene King plc’s 6-core values are:
• Courage - to maintain a high level of integrity whilst having the courage of your convictions
• Honesty - to be fair, open and honest when dealing with others within and outside Greene King
• Respect - to create an environment where colleagues can realise their full potential
• Results - do what you say you will do to achieve personal, divisional and group results
• Execution - ensure business activities get done
• Customer focus - anticipate and then deliver service excellence every time for both internal and external customers
Pub Company Vision
Along with the overall company values Pub Co also has its own vision:
“That the Greene King Pub Company delivers the best hospitality in the Industry. Firstly by attracting and retaining the very best people to grow our business. Followed by training, supporting and enthusing every employee; so that we deliver “Excellence Every Time” to our customers.”
Excellence Every Time is very important throughout each division in Pub Co.
Not only is it a vision that is worked towards by all support teams, but also, most importantly, it is a vision that is living and breathing in the pubs and hotels.