Recession, what recession? The hospitality and catering industry continues to offer a great variety of career opportunities

The UK hospitality and catering industry encompasses a host of businesses, including hotels, restaurants, pubs, bars and nightclubs, contract catering, holiday parks, private members’ clubs and visitor attractions. Hospitality offers a host of opportunities to those wishing to move into it, including:

• career progression – nearly every job in this sector offers you the chance to learn, improve your skills and move up the career ladder to the next level – and, historically, Service leavers are very good at this
• a dynamic and challenging industry – in hospitality management no two days are ever the same, and opportunities exist both nationally and internationally.

Although the sector offers a host of different jobs (such as kitchen and catering assistants, bar staff, chefs/cooks and waiting staff) this feature focuses on those that are most likely to be of interest to our readers.

An industry changing for the better

There can hardly be an area of the UK that is untouched by the hospitality sector, and it offers job opportunities on a large scale. However, another aspect of a 21st-century hospitality career is the drastic reduction (due to new EU regulations) over recent years in the number of working hours expected of hospitality managers, with responsible employers offering a 48-hour week with two clear days off. The industry, confirms Bob Cotton, chief executive of the British Hospitality Association (BHA), ‘is changing rapidly. A five-day week is now commonplace, and conditions of work can match the best across all industries.’ In addition to better working conditions, many companies offer outstanding performance-related bonuses, incentives, training opportunities and benefits.

The pub/bar and club (managed houses) sector of the industry has responded well to recent changes and the current economic climate – by, for example, providing smoking accommodation and entertainment, investing in properties to encourage family visits, offering venues for young people and developing catering offers. Many such national companies are reporting increases in overall sales and profitability and are, therefore, able to offer excellent employment packages. Such organisations are always on the lookout for quality candidates to join at supervisory and management levels, which is particularly good news for Service leavers. Recent examples include national operators JD Wetherspoon, Mitchells & Butlers and Greene King, all of which are expanding their ‘managed estates’ by over 800 outlets across Britain, in a move that will create around 25,000 jobs. There are nationwide employment opportunities for those seeking a career in hospitality management; many national companies are crying out for good-quality applicants. So, despite the current economic climate’s effects on many other sectors, the UK hospitality industry continues to thrive.

Hospitality and catering skills gained in the Services
As all the Services employ catering staff, it is likely that readers will already have gained useful experience of working in hospitality and catering roles. In addition, professional qualifications in hospitality and licensed retailing can be gained while in uniform, which will prove useful when thinking about moving into a civilian career in this sector.

The managed sector

Managers are responsible for operating premises as paid employees of a company, which include most high-profile town-centre national chains, large suburban family eating pubs, and many community locals and hotels. Some national companies offer ‘fast track’, accelerated promotion to those who have completed an accredited resettlement course, and have the right attitude, motivation and ability. This grade of entrance is known as ‘Manager in Training’ (MIT). If you are selected for this, you can expect a general management appointment in a matter of weeks/months. Officers and NCOs may find themselves having to take a pay cut in the short term, but promotion comes quickly in hospitality management to those who are prepared to work for it.

Career progression

Career progression in the managed sector depends very much on the individual, but, as noted above, promotion comes quickly for those who want it. The training available in some organisations is excellent. There are currently three main development routes:

1. going straight into the industry
2. attending a short pre-release training programme run by a local college or training company
3. undertaking a full-time college or university programme.

Although direct entry at management level is not uncommon, most new entrants, particularly with national companies, begin their careers as a trainee manager, assistant manager/shift manager or team leader. Point of entry is likely to depend on experience, ability and qualifications, as well as on how well the interview went, as first impressions count (which you’ll find out more about at your CTW event).

The self-employed option

As a free house owner or tenant licensee you are ‘your own boss’ – you run the premises your way, and in most cases operate through a brewery or pubco (lease and tenancy). You plan, develop and control your business, employ your own staff, pay your overheads and keep the profits. You make your pub what you want it to be – but it must be successful and, more important, profitable.
Training and preparation are vital for this career option, as you will get only ‘one shot at it’. Success for the self-employed means getting it right first time, so only those with the necessary confidence, commitment and ‘freed up’ capital should undertake this particular career option. There are several routes for Service leavers to consider, as outlined below.

The free house owner

You buy the freehold building and the business outright, and trade as you wish. You can normally borrow up to 70% of the ‘bricks and mortar’ value, but this will depend on the current economic climate; you will also need to produce a detailed business plan for your proposed lending source should you need to borrow.

The leaseholder

The lease is a legally binding contract for anything up to 30 years for a new lease, which you can sell on (assign) after two or three years, and is intended for the experienced operator only. You purchase the fixtures and fittings, the stock, pay a security bond and in most cases (new leases excepted) will be required to pay a premium (goodwill) for the value of the lease, depending on how many years it has left to run. All prospective leaseholders will be required to pay valuation, legal and surveyors’ fees. You may also be asked to pay for the company’s own training programme. However, most companies are prepared to waive this requirement if you have already attended an accredited resettlement course and have the relevant qualifications in place at the time of application.

Most leases operate under a purchasing agreement for stock, with some having either a full tie (you buy all of your ‘wet stock’ through the company) or partial tie (beer only and free for everything else); or they may operate a ‘total free of tie agreement’. You will also pay rent to the owning company, the level of which will depend on estimated turnover and profitability, and the type of tie agreement in place. A similar agreement will operate with regard to ‘machine income’; again this arrangement will be reflected in the rent charged.
There are several types of lease available, with different conditions attached; you should, therefore, seek professional advice if you are considering this option. It is also essential that the company’s and lessee’s respective responsibilities are clarified in the early stages of enquiry. These can sometimes be found on the company’s website.

The standard let tenancy

This is often considered to be the most ‘user-friendly’ of the self-employed options. The incoming tenant purchases the fixtures, fittings and stock from the outgoing tenant and pays a security deposit to the brewer/pubco (this is known as ‘the ingoing’). You will also need funds to cover legal and valuation costs, as well as some working capital to help get started.

There is no ‘premium’ to pay as a new tenancy agreement is drawn up each time the business changes hands. This agreement will normally run for a three- to five-year term, with the opportunity to renew. However, many brewers and pubcos currently offer easier, cheaper and less legally binding types of agreement. These are sometimes referred to as ‘try before you buy’ deals, with the opportunity to transfer to a full standard let tenancy or lease agreement at a later date. These types of self-employed opportunity can, however, involve businesses at the lower end of the scale: small, poor location, poor reputation or, worse still, boarded up. They are sometimes marketed as ‘starter houses’ for newcomers to the industry or those with limited capital. Proceed with caution!
Tenants are subject to either a full or partial ‘tie’ for their ‘wet stock’ and may be held responsible for internal decoration and the brewer/company for external (usually every five years). Should you wish to leave the tenancy, it is customary to give six to 12 months’ notice. However, most brewers/companies will make the effort to speed things up, and you could be out in 10–16 weeks.

‘Private tenancies’ are also available. These usually involve either an individual or company who wishes to let out the business as a tenancy. Such opportunities are advertised in the trade press (e.g. the Morning Advertiser and The Publican, both of which have websites – see ‘Key contacts’).
As you will be responsible for ‘paying the bills’, it is important that you are aware of all business expenses: in addition to rent and wages, you will be responsible for business rates, utility charges and all other running costs.

Qualifications and training in the licensed trade

Salaries

Rates of pay in the managed sector have risen considerably in recent years, with some companies offering amazing bonuses for hitting targets (something that Service people are good at!) to attract good-quality applicants. For management or supervisory roles (those likely to be attractive to, and achievable by, Service leavers) in larger companies, typical salaries might be:

• trainee, assistant or shift managers  £18,500–£25,000
• house, unit or general manager   £25,000–£65,000.

Earnings can be enhanced by substantial performance-related bonuses (up to 100% of salary in some cases), and benefits such as food and accommodation allowances, childcare vouchers, free shares and private health cover, further training as well as, of course, rapid promotion prospects.
In the self-employed sector, as a rough guide, a tenant/leaseholder should be able to draw a net profit on the bottom line of 10–20% of net turnover, depending on sales volume and quality of management. Generally, a freeholder can expect a much higher level of net profit. Any borrowing will also need to be taken into account.