Co-op News September 2021

SEPTEMBER 2021 | 35
The brief suggests one pub per community
catchment, with each individual pub business
becoming an investor in an Open Capital
partnership (LLP). Surplus would be reinvested
in purchasing or investing in more pubs.
It would follow a simple structure, with
no involvement with operations or supply of
products. The brief considers the possibility of
the purchase of the commercial property estates
of pubs like Global Mutual did last year from EI
Group – picking up 370 pubs for £350m.
“THERE ARE A LOT OF PUBS AND
THEIR COMMUNITIES THAT NEED TO
BE SAVED FROM THE RAVAGES OF
PRIVATE EQUITY GREED”
“There are a lot of pubs and their communities
that need to be saved from the ravages of private
equity greed,” said Mr Dodds. “Pub companies
are run by extractive hedge funds – they are
asset-sweating British pubs and closing them
down.”
He says this is a matter of urgency, with the
pub sector already in crisis before it was hit by
the Covid-19 pandemic.
“Every tied pub is by default run down,
knackered, in need of refurbishment – the
kitchens and heating systems often aren’t up to
scratch.
“If it needs a new boiler, the tenant can’t
afford it. If we can acquire the sites it would be
a good opportunity to get of their gas and oil
fired systems; we would carry out a low carbon
retrofit.
“And we would use only local resources and
beers – get rid of global brands unless they can
give guarantees that they operate sustainable
supply chains.”
Local involvement would come from the start,
he added, with the community deciding what
happens in the pub, but with a professional
overview from those experienced in the pub
trade, who know how to keep and sell beer and
manage the clientele.
Mr Dodds says that under the plan, each pub
would pay a national living wage and run a fair
pay ratio; sites would be run independently with
head office organising back office functions, as a
secondary co-op, for the whole network – taking
care of admin, accounting, training, branding
and marketing.
“The licensee would have secure long term job
as an employee. We’d also work to tackle the lack
of experience, skills and diversity in the industry,
and address the lack of access to market from
local brewers.
“We have crises running in parallel – affecting
community, pubs and climate. We need
something to bring them together so they can be
managed at human level people can relate to.”
But Mr Dodds says there are also barriers to
overcome within the co-op movement itself,
citing the often-heard lament that it “doesn’t cooperate
and doesn’t move”, which has in the past
hampered his efforts to establish a secondary
co-op for the sector. Meanwhile, he warns, the
existing community pub model faces potential
weaknesses – with the risk of volunteer burnout,
lack of knowledge of how to properly run a
pub, and a lack of profitability.
“There are some very good ones but if all
community pubs were invested in and properly
run they would be thriving.”
It’s an ambitious plan: Mr Dodds estimates
the venture would need to raise £500,000 per
pub – “to get any pub up and running fossil
fuel free that is”. He wants to see a “big plan,
go to whole country to crowdfund capital – a
national community share issue – along with £1
memberships. It would be a national campaign
to save Britain’s pubs.”
The pubs would be protected by an asset lock,
with a dividend paid to investors on the amount
of equity they have put in; he’d like to see 4%
paid on capital invested.
“If you want to take your money back out,
you’d give two or three months’ notice; your
shares would be sold among membership or the
company would buy them back; but there would
be no capital gains.”
A steering group – which includes experienced
co-operators Vivian Woodell and Dave Boyle – are
working on the seed fund application which will
bring the proposition to investment readiness –
paying for legal structures, branding, marketing
and Youtube videos.
“The challenge is there has been no pub co
like this before,” warns Mr Dodds. “It needs team
of people who know finance and property and
want it to happen. Pub experts should be on the
ground in the pubs.
But – in a time when national life is marked
by polarisation and social isolation, the model
would continue the aspirations of community
pubs to offer social value. Mr Dodds hopes the
move will “revive the world’s original social
network” and offer venues to “curate the national
conversation.”