After 15 months at Peach Pubs as operations director, Paul Cutsforth moved to Orchid to take up the same role. Nine months into his new job, he tells Neil Gerrard why he switched companies, explains his role and outlines Orchid's plans for 2011
You left the role of operations director at Peach Pubs after just over a year. Why did you decide to join Orchid? If you had asked me when I was at Peach if I could see myself back in multi-site pub groups I would have probably said no. But I think it was Rufus Hall's [Orchid chief executive] vision of what Orchid was about that drew me back into large pub companies. What I learned in the 12 months when I was at Peach was much more about how you run entrepreneurial small-site businesses. And what I recognised was that if I could try and combine some of the entrepreneurial skills that Peach demonstrated with large multi-site technical experience that I had gained in the past, then you would have a strong winning formula.
How are you organising your time in your new role? A large part of the first three months was spent driving round the country getting to see the diversity of the Orchid businesses for six or seven days a week. Now that settling period has drawn to a close, my working week is split between one to two days a week at the head office in St Albans doing the strategic/operational planning part of the role, and the other three to four days a week out in the pubs, restaurants and bars - either with the area managers or the divisional heads of operations really seeing first-hand the individual businesses.
What sort of things are you looking out for? First and foremost I look at it from a guest experience point of view. You have to remember every time you walk through the door that you are seeing it as a first experience from a customer perspective so you are seeing it with fresh eyes. Familiarity does breed contempt.
You are in the throes of revamping your Living Room businesses. How is that progressing? We recognised when we acquired the Premium Bars and Restaurant business at the back end of 2009 that the late-night sector was under enormous pressure and some of those businesses had not been invested in for some time. We have invested now in six of the 16 Living Rooms and we have a plan to work on another six to 10. Hopefully by the close of 2011 most of the Living Rooms in our portfolio will have had some kind of investment. It is not about revolution, particularly with this business. We believe that the offer still has a great connection with its customer base. But it's about an evolution of the concept, so we are trying to make the bar areas a little more contemporary with the introduction of a granite-backed bar - small touches that differentiate while still maintaining the old colonial theme.
And what are the plans for the Orchid business as a whole in 2011? We are looking for opportunities to differentiate some of the businesses, particularly in the local pubs market. As an example we took an old Mr Q's wet-led sport community business recently in Hornchurch, Essex, and refurbished and converted it into one of our Dragon pubs [English pub combined with a Thai restaurant]. It is now called the Ardleigh and Dragon - and that has been a hugely successful transformation of what was a very low quality community pub.
I think for 2011 we will continue to do that. We are looking for more opportunities to convert some of the drink-led businesses into food-led carveries and freehouse dining businesses.
And what about Orchid's plan to open another 100 businesses? My primary remit is the day-to-day operation of the core Orchid business so I don't have a great deal of involvement with Parkmill, which is the vehicle that oversees the expansion, led by my predecessor Magnus Wilson. But with the plans for growth it is quite important, particularly in these turbulent economic times, that the acquisition strategy isn't about numbers but quality.
We are looking for sites that fit into our portfolio of pubs on a single-site acquisition basis. Because we want more food-led businesses, we are looking for opportunities for our carvery buinesses, our Thai Dragon pubs and also our freehouse dining two-for-£10 model.
How much is at your disposal financially to grow? I wouldn't want to give you a figure. We do have the funds at our disposal but it needs to be for the right opportunity.
How do you think the VAT rise will affect the business? It is a concern. We have been thinking long and hard about the increase. Particularly at the moment, the economy is in a fragile state and any price rise that is passed on to the customer is one that needs to be thought about very carefully. We will definitely have the 2.5% VAT increase and then we will probably have a further duty increase coming up in March/April, too.
So we have decided to undertake an individual approach within each business, and have completed competitive price surveys across the whole of Orchid. So there may be some businesses where we do pass on the full VAT and duty. But there will also be a fair number of businesses where we either hold the prices or even reduce them.
What do you think of the coalition Government and its approach to your sector?I wouldn't like to pass a political comment but I suppose the biggest story regarding Government policy at the moment is the reduction of the debt and the impact that it is having right across all communities in the UK.
The concern with that is that the leisure market is potentially prone to suffering. If people have less disposable income in their pocket then they will go out and eat and drink a little bit less often. However, I do feel that in difficult times customers become more discerning. Businesses that are well-invested but have a broad appeal and offer good value for money will prosper through difficult times.
paul cutsforth: cv
March 2010 Joined Orchid as operations director
â- Jan 2009 Spent 15 months at Peach as operations director
â- 2002-2008 Barracuda Group. Most recent role was head of operations at Midlands and North division, responsible for 110 of 220 businesses and instrumental in their acquisition and growth strategy through the Smith and Jones concept
â- 1990-2002 Started career with Allied Lyons, later Allied Domecq. Last role was as operations director for Spirit Group
Favourite drink Cask ale - Tetleys ale (unfortunately they have stopped brewing in Leeds now, which is a crying shame)
Drives Jaguar XK
What do you do to relax? I got into road cycling about six years ago - I like nothing better than spending four hours on a bike