The British pub fights back
The pub industry has had a harrowing time in the UK in recent years. The smoking ban, cheap supermarket alcohol and the economic climate have all taken their toll. But, interestingly, whilst pubs all over the UK have been closing down, one chain is going from strength to strength. JD Wetherspoon has been bucking the trend and has opened 16 new pubs in the last three months! So why is it that has Wetherspoons has thrived whilst others have struggled? Competitive pricing… serving breakfast… or something else?
Because Wetherspoons suck the blood out of a struggling independant brewing industry. I know personally the owner of an independant brewery who had a contract with wetherspoons. He was forced due to raising costs to raise his prices, all his customers were informed. Wetherspoons continued to order on a weekly basis but did not pay when invoices were due.
He continued to supply simply because a small business cannot afford to lose customers of this size. After a number of months he was forced to confront the problem afrter getting no response to letters. At which point he was informed that THEY HAD A PROBLEM WITH HIS ACCOUNT!!! he no longer fitted in with their pricing policy and therefore they would not be paying the higher prices (despite the fact that they had continued ordering on a weekly basis for 4 months after the new prices were introduced).
So the answer is simple they hook small companies in with big orders and then when you can’t survive without them THEY TELL YOU what you can charge, if you don’t play ball you go bankrupt and they move on to the next little guy.
Whilst I have some sympathy for that predicament, one golden rule of business (whatever the nature of the business) is not to put all your eggs in one basket. With the benefit of hindsight, of course, it sounds like in this instance Wetherspoons should have been confronted sooner on the issue and that the brewery in question shouldn’t have been over-reliant on just one customer.
I hope your friend has managed to find his feet again…