Tuesday, 3 June 2003

On the economics of public houses

I was partaking of a small beverage at lunchtime today when the landlord moaned that the price of his "all channel including full sports coverage" cable television service had been increased. We were asked to guess the new rate. I ventured £1,200 per year - about four times what I used to pay at my flat in London. The actual price had been increased from £5,000 to £8,000 a year and he needed to sell £24,000 worth of booze simply to cover the cost of the television.

Someone suggested that a few go-go dancers could be hired for less than that but perhaps it wouldn't be such a good idea if it meant no more football.

Being a more high-minded sort of chap, I observed that his gross profit margin must be in the region of 33%. He hesitated before admitting that the target was more like 40%. So when you buy a £2 pint (I am no longer in London), £1.20 goes to the brewery and I suspect that most of that is passed on to Gordon Brown.