Looking to the future

Major investment in improving its pub estate has been the key to success at Manchester's Joseph Holt Brewery. Tony Halstead reports

If you're ever lucky enough to visit Manchester-based Joseph Holt, you will no doubt be fascinated by the giant 54-

gallon hogshead containers the brewer still uses to deliver beer to its north-west pubs.

But brewery managing director Richard Kershaw prefers to talk instead about the rapid progress his 132 pubs are making, as the company continues to refurbish and modernise its estate.

Pride of place in the Holt's estate undoubtedly goes to the Woodthorpe, a rambling Manchester suburban mansion, once the home of the founding brewery family and now a smart destination food venue that enjoyed a lavish £1m refurbishment last year.

Great payback

It proved to be money well spent for the pub is now turning over a not inconsiderable £30,000 each week and fully justifying the

expenditure.

Indeed, many of Holt's pubs are now a far cry from the "ale-house" image that was a feature of its pub estate in years gone by.

Many houses have been distinctively re-

designed to meet more modern-day consumer needs with food one of the new drivers.

The huge growth in the eating-out market and latterly the smoking ban has largely seen to that.

The company has spent £6.5m on improving its pubs, and over the past two years it has acquired a further six at a cost of £7.5m. The bulk of the estate is still directly managed, with only 10 tenancies in operation, and it's a formula that suits the company's trading style well. Many of the houses are still unashamedly wet led, but the balance between beer and food is narrowing all the time.

"We are not afraid to stick with what we are good at and beer remains the main driver across our pubs," says Kershaw. "But we are making major advances on the food side and more pubs are now pushing out an impressive offer." Kershaw says in other pubs, mainly community houses, Holt is increasingly offering basic "behind the bar" style food, such as pizzas and panini.

"I think we have discovered a sound food base in our beer pubs, which has been important following the smoking ban," he adds.

Holt spent £3m in preparing for the smoking ban, with the result that 75% of its pubs now have a shelter or some other kind of smoking facility for customers.

"The ban has effectively determined how long people stay in our pubs," says retail director Tom Dempsey. "People tend to drink more slowly and do not order a fresh drink at the same rate as before, so there has been a definite effect on turnover by as much as 0.5%."

Dempsey feels that is why the growth in food turnover and other non-wet income has been so important.

"We have to attract people into our pubs by making them comfortable venues with attractions such as Sky. At the moment we have Sky installed in 60 venues across the estate," he says.

Investment in lager

As investment in the pub estate has increased, Holt has been careful to ensure that spending on its brewery has been maintained.

A £500,000 investment in lager production two years ago and a new kegging plant has enabled Holt to maintain supply to its pubs. A major beneficiary of the plant is Holt's newest brand, Joseph Holt Smooth, a 3.8% abv nitro-keg ale launched last August.

The new beer has tasted instant success across the company's tied estate and underlines Holt's determination to meet modern-day drinker demand for smooth-brewed products.

A microbrewing plant has also enabled the company to produce small brew lengths - ideal for the guest-beer market - and develop a growing seasonal ales programme.

While Holt's Bitter remains the brewery's key stand-by brand, lager currently accounts for 30% of the brewery's entire production.

Holt is one of relatively few independent brewers that produces its own lager, which finds its way predominantly into the company's tied pubs.

At 3.8% abv, standard lager Crystal and 5% abv premium brand Diamond have both proved popular with customers wishing to try something different from mass-produced national brands.

Bottled boom

Business in bottled beer is also growing, particularly into the off-trade where Holt is now producing 100,000 12-packs of 500ml bottles thanks to increased supermarket business.

"As more supermarkets increase their shelf space for bottled products, the openings for regional and independent brewers have become big business," says Kershaw.

On the ale side it is the renowned good value for money of Holt's beers that has been a major selling point.

Holt's Bitter currently sells at £1.68 a pint in managed pubs, while mild weighs in at a bargain £1.60. Few brewers or pubcos can compete with these sorts of prices and it is a point of difference that has set the brewery apart from the vast majority of its rivals.

Holt's humble origins

Holt was founded in 1849 and rapidly became one of Manchester's most enduring institutions.

Born in 1813, founder Joseph Holt began early life as a humble carter at Harrison's Strangeways Brewery. In 1849, he married 40-year-old Catherine Parry, a Welsh governess. In a shrewd business move, Parry mortgaged her own property to finance a small brewery behind a pub in Oak Street, in the centre of Manchester.

Business must have gone well, as the Holts moved to the Ducie Bridge Brewery with a 12-barrel "pan" in 1855. Holt lent money to new licensees and in return they paid him 5% interest and sold his beer.

In 1860 he bought the current site in

what is now Empire Street and built a

brand new brewery.

In 1914, the brewer formed close links with the world-famous Christie Hospital in the city. It decided to provide support through the founding of the Holt Radium Institute, pioneering the use of radium for the treatment of cancer.

On her death in 1996 Lady Margaret Holt left £7.5m worth of her shares in the company to continue the work.

The company has remained in the family, passed down through the generations. Current managing director Richard Kershaw is the great grandson of the founder.