1. The Licensed Houses Sector Review Michael Common Lorelle Stroud Akiko Kobayashi Coris Leachman Nick Brookes Debbie Mitchell

2. Introduction  Definition  Topics Covered  Conclusion

3. Definition An establishment retailing alcoholic beverages either on or off premises On Licence: Definition “…this allows the holder to sell intoxicating drink for the consumption on or off the named premises. It may be restricted dependent upon the public need.” Off Licence: Definition “…this allows the sale of intoxicating drinks for consumption off the named premises only.” An alcoholic drink: Definition Alcohol free: Must contain NO MORE THAN 0.05% a.b.v. Low alcohol: Must contain NO MORE THAN 1.2% a.b.v.

4. Topics Covered P.E.S.T.E analysis Consumer trends Key Markets Competitive structure Competitors SWOT analysis Scenario Analysis Future?

5. P.E.S.T.E Analysis Political Legislative changes Licensing laws Economical Economic state has an effect on people’s willingness to travel and spend Cheaper imports – booze cruises Social Growing concerns about health issues and drink-driving Larger disposable income amongst young people Social trends are being catered for by the market. I.e. more women drinking now, more Alco-Pops Technological Internet, WAP,& Palm top act as promotional and recruitment tool Computers have also increased efficiency in till, reception, office and security systems Environmental Weather conditions affect people decisions to go out or stay in. The climate can cause damage to property in serious storms

6. Consumer Trends

7. Key Markets Town / City Pubs (e.g. Hogshead, Yates, O Neills) A, B, C1 + C2 (18-44 years) Rural Public Houses (Predominately tenant run e.g. Queens legs, Cockwell Inn) A, B, C1 + E Urban Public Houses C1, C2 + D (18-34 years) Family Focused Public Houses (e.g. Brewers Fayre, Harvester, etc.) A, B, C1 + C2 young families Wine Bars ABC1 (working females) ABC1 25-24 year male Chameleon Bars Over 25s Night Clubs 15-24, and over 25s Jicnars social grading system A- Upper Middle class B - Middle class C1 - Lower Middle class C2 - Skilled working class D - Working class E - Lowest income

8. Future Key Markets Town/City Public Houses Working women from the ABC1s Older middle youth Grey market Rural Public houses ABC1 + E Urban Public Houses C1, C2 + D (predominately male) Wine Bars Working women from the ABC1s 25-44 ABC1 male Chameleon Bars Over 25s Nightclubs 15-24s Family Focused pubs Young families Grandparents with grandchildren Grey market Jicnars social grading system A- Upper Middle class B - Middle class C1 - Lower Middle class C2 - Skilled working class D - Working class E - Lowest income

9. D B A C Competitive Structure Marketing Intensity Geographical Coverage A –Multiple pub operator mostly non-branded e.g. Nomura B –Multiple pub brand e.g. Whitbread, Bass C – Smaller Entrepreneurial operators e.g. Yates D – Independent Pubs e.g. The Xchange

10. Growth in the pub market Growth in pub turnover

11. Competitive Rivalry Potential Entrants Buyers Suppliers Substitutes Bargaining Power Threat of Entrants Bargaining Power Threat of Substitutes Porters Five Forces Analysis Reference: M.E. Porter, Competitive Strategy, 1980 (With specific application to Licensed Houses)

12. S.W.O.T. Analysis Strengths Constant demand Customer focused Social Experience Ability to cater to a specific market Branding and merchandising Weaknesses Competition for independent licensed houses Opportunity Costs, e.g. drugs, cinema Booze cruises Drink driving promotion Negative public image – e.g. alcoholism and violence. Opportunities Relaxed licensing laws Grey markets Food sales Cannabis toleration Diversification/differentiation Internet, WAP, Palm - (promotional, info and recruitment tool) Market penetration Threats Cannabis toleration Booze cruises Home entertainment Economies of scale from larger companies Public Health conscience

13. Scenario Analysis Optimistic Realistic Pessimistic Future Analysis Licensed Houses