The company that's turning unprofitable pubs into trendy hostels

17th June 2010, 11:14am

Nowhere has the economic squeeze been felt harder across Britain than the economic barometer that is the good old English Pub.

Pubs across England, Scotland and Wales are all under pressure and are feeling the increasing pinch.

With almost 40 pubs closing weekly across Britain, the rate of losses is highest in the North and East Anglia – whilst the number of pubs in both London and Yorkshire fell by over 100 in just 6 months.

The figures, produced for the BBPA (British Beer and Pub Association) by CGA Strategy, show that the number of pubs in England, Scotland and Wales fell by 1,013 between June and December 2009 with 1,566 closing and just 553 new pubs opening for business.

Every English region, as well as Scotland and Wales, show falls, as a range of factors, including the recession, successive tax hikes, cheap supermarket alcohol prices and growing demands from Pubcos, have hit pubs hard. In the North West alone, 10 pubs a week are closing – that's a drop of 3% in just six months.

Landlords are having to become ever more creative in their response to the trading environment, and often that means looking beyond wet sales. Food used to be a convenient revenue booster, but with customers harder pressed and increasingly demanding, the offering has to be spot on to really work.

An exciting new company called Visit Journeys think they have a different solution however. Visit Journeys are a fast growing UK hostel company that specialise in pub conversions and turning unprofitable pubs into thriving businesses, with a little help from an innovative kind of bunk bed.

Whilst Visit Journeys already have hostels set up around the world they are now focussing specifically on the UK and helping struggling landlords. Visit Journeys will help turn unused pub space into hostel dorms and often use their 'micro cell' bunk beds, which utilise full black out curtains, individual power supplies, shelves and lights to create a private space within a dorm scenario.

Their business model also means new conversions can utilise their website for bookings and ensures they will have guests from the day they open. With sites operating as far away as Sydney and Kuala Lumpur the brand has a loyal band of globetrotters that use its hostels around the world.

The model clearly works too. One of the first pub based Visit Journeys sites in London, which has been running for two years was created in a dilapidated pub near London Bridge and in just its second year of trading turned over £630k, yielding a profit of £221k. The creation of the hostel still allows the pub to run as a pub and keep its own identity, but also offers a whole new means of revenue generation.

Dean D'Eye, director of Visit Journeys, now believes they could well help large numbers of pubs in the UK get back on track: "The poor British publicans are getting hammered from all angles at the moment by the pubcos they're tied to, by less and more frugal punters coming through the door and Westminster's tax attacks.

"We have now helped a lot of pubs worldwide turn their situations around and diversify the pressure from just drink sales, resulting in landlords working less hours for more money. We reckon that using our model and online booking system most pubs in the UK could pay the start up costs off in the first year of trading and then start to pocket the profit.

"The British pub is an iconic institution, and we are convinced that our model offers hard working landlords up and down the country a means of increasing profits, and in some cases survival."

Click here to submit a comment!

Have your say!

To comment on this article, simply enter your name and email and send us your views. Please note that your comment will appear publicly below this article once it has been processed. For enquiries please email info@eatoutmagazine.co.uk.

Name

Leave blank

Email

Comment (max 800 characters)