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Fox and Goose - Community buyout

From Mark Simmonds

Tuesday, 10 January 2012

There is to be a public meeting at 8pm on Tuesday 24th January in the Fox and Goose, Heptonstall Rd., Hebden Bridge. Julia the current landlord is going to sell the Fox and Goose in the near future.

The purpose of the meeting is to discuss the possible purchase of the pub by a community co-operative, gauge the level of interest in the community. If there is sufficient interest then we can also explore the next steps in the process.

A community buyout is the option that Julia would prefer. If the community do not buy the pub then it will be sold on the open market, with all the uncertainty about the future that that entails.

This is what the Plunkett Foundation an organisation which supports community enterprise (and has offered support to the Fox and Hebden) says about Co-operative Pubs:

"A Co-operative Pub is where a significant part of a community comes together to form a co-operative to try and save and run their local.

Co-operative pubs are different because they encourage widespread community-ownership at a level the majority of the community can afford. Currently the majority of Co-operative Pubs are where the community has purchased the building, however if they feel it is appropriate, some communities may choose to take on a lease initially with a view to purchasing the property in the future.

Co-operative pubs are set up on a 'one member one vote' basis rather than a 'one share one vote' basis. This creates a democratic way of running a community business and ensures that everyone has a say in how they want their local pub to be run.

Like any business, a co-operative pub aims to be profitable - it is what happens with the profit that sets it apart from a private enterprise. A Co-operative pub can distribute profits to the members, reinvest the profit in the business or distribute funds in the community for the benefit of the community.

Community-ownership is becoming increasingly popular in the UK. There are now around 250 co-operatively-owned village shops in the UK and the co-operative model has also been adopted by energy schemes, woodland projects broadband initiatives, housing schemes and much more. Co-operative ownership is a sustainable and ethical way of doing business. 97% of co-operatively-owned village stores opened over the past 25 years are still open and trading today."

If you would like more information and to see examples of community owned co-operative pubs, you can see them here.

I think there is mileage in this idea and I would hate to see the Fox become a private house or another soulless PubCo. Rather than a crisis, this is a marvellous opportunity to secure a community asset and make it even more of a community hub.

But in order to buy the pub, the community will have to raise the money, generally by purchasing shares, and obviously people will have questions before parting with their cash.

I would like to encourage people to attend this meeting and also to use this discussion forum to ask and answer some of those questions and to say what you think about this idea.

There is also a suggestion box for questions and comments in the Fox.

From Paul Clarke

Tuesday, 10 January 2012

I wish you good luck with this...it seems virtually everything round here is going to run by community volunteers.

Just a matter of interest what sort of money are we looking at and I hope some of the sharp brains in Hebden will make some useful suggestions on models via this board.

From Mark Simmonds

Wednesday, 11 January 2012

Purchase price uncertain at moment, but obviously that is a question that needs an answer in the very early stages.

I don't think that we should assume that just because any enterprise is co-operatively owned by the community that it is then run by volunteers. Historically co-operatives are about sustainable livelihoods. I don't see any reason why a co-operative Fox couldn't employ a manager and bar staff. At the end of the day any co-operative is run in the way that the members decide. All options are open.

From David Telford

Wednesday, 11 January 2012

I wish anyone who looks to make a business investment all the luck and hope the venture in profitable (be the rewards quantitive or qualitive)

What is the status of the proposed co-operative? As long as the new incvestment group pays the same business rates and tax as it's competetors, I wish you all the luck.

Running a pub is a dfficult business and that investment can lose money if you don't get it right.


From Mark Simmonds

Wednesday, 11 January 2012

Most co-operative pubs use the Industrial and Provident Society legal form, which can issue withdrawable shares to the public; those buying shares becoming voting members.

Any share offer would need to acccompanied by a prospectus, which as David points out should point out that buying shares puts that money at risk.

As regards tax and trading, co-operative pubs are treated the same as privately owned pubs, although it may be worth investigating whether such a pub would qualify for mutual trading status similar to that which applies to working men's clubs - the principle being that you don't get taxed on trade with your own members. I suspect that this would be difficult to administer in practice in a pub.

From David Telford

Wednesday, 11 January 2012

I do think there should be a level playing field with other licenced premises with regard costs. With the smoking ban etc, it's increasingly difficult trading but I'd hate to think other businesses were put at risk due to an unfair advantage gained other than simply providing a jolly good night out.

I make this point on the back of a former of mine client is closing 2 of it's 5 shops where Charity shops have moved into selling new arts & crafts. Fair enough we'd say but those charities are not paying rates, do not charge VAT & these goods which in some cases were sourced from the same factory as my client. Given they also don't have to pay volunteers where my client had to make her staff redundant. Nobody minds competition as long as we can ensure a level playing field.

From Mark Simmonds

Wednesday, 11 January 2012

Quick one: Co-operatives are are not eligible for mandatory rate relief. Charities are.

From David Telford

Thursday, 12 January 2012

Sorry Mark, I am aware of the Business rates arrangements, my example was simply how commercial businesses are being adversely affected by an abuse of loopholes by charities / organisations purporting to be do-gooders.

I'd feel that any application for mutual trading status would give a potentially unfair advantage over other pubs etc which could be damaging to well-run commercial businesses. I think it's very naive to believe that such status would not be abused.

From Kate Westall-Ives

Thursday, 12 January 2012

David, Charity shops selling 100% new goods would not be eligible for rate relief. Also, those charity shops trading in Hebden are not run by "charities / organisations purporting to be do-gooders"

They are retail units raising funds for very worthwhile charities.

From David Telford

Thursday, 12 January 2012

Kate, You are right though some charity shops make the most of this little loophole to the detriment of good commercial businesses.

Co-operatives are a great way of forming a multi-owner business model and limited liability. I applaud anyone who puts their money where their mouth is and tarts a business venture. All I'm saying in this case is that initial altruistic intentions should not give them an unfair advantage over other other pubs and discotheques.


From Tim B

Thursday, 12 January 2012

Co-operatives are an excellent business model - risks and benefits are shared rather than falling on the shoulders (or into the lap) of one individual. I would expect to see more spring up in uncertain times.

From Benny M

Friday, 13 January 2012

Once all the excitement has died down it must be remembered that a mutualy acceptable price will have to be agreed .A recent similar exercise not far away failed miserably when prospective purchasors and vendors could not agree a starting price. The present owner will want a fair price. Coop's tend to have to many individual opinions leading to little in the way of results.

From William Bell

Friday, 13 January 2012

It's always a shame to see charity shops dismissed as the preserve of "do-gooders" as if doing good is a negative motivation. It suggests that organisations mandated to help the vulnerable, conduct vital research etc and those who volunteer their time to raise essential funds are merely an irritant to those bastions of the community who only regard individuals as potential profit. I hope that the Fox does become a community pub and that it maintains its distictiveness from the march of blandness that the commercial sector is foisting upon us in many of the other pubs in the area.

From Mark Simmonds

Friday, 13 January 2012

Benny M, You correctly identify that the price is going to critical to the success of this project and is one of the first issues that will need addressing. I wasn't aware of any similar local attempt to create a co-operative pub - please encourage them to share their experience at the meeting or on this forum.

With regard to co-ops having many opinions, I would argue that this is one of their many strengths, contributing to their long term survival rate being twice that of non-co-operative enterprise and the fact that there are three times as many member owners of co-operatives (1 billion) than individual shareholders (328 million) worldwide.

From David Telford

Friday, 13 January 2012

William Bell, Don't get me wrong, I'm not against charity shops etc, they usually have noble aims and we're happy to have them on the high street in moderation. I wasn't trying to make a sweeping generalisation on charity shops no more than I'm sure you were not when referring to enterprising types (who provide employment and a livlihood for them selves, their family and the thousands of people in their employ) as those "who only regard individuals as potential profit".

There is an issue with the loopholes that allow them to avoid taxes which gives an advantage over commercial businesses. and where (usually the large national charities) go beyond the remit of taking in the odd bit of brick a brac or old clothes and try and sell them as a curio or simply for those who can't afford new.

The advantages offered to charities do have adverse consequences for other businesses and that is my concern becuase it creates an unfair adantage. In retail, businesses are seeing their rents driven up / kept artificially high by charity shops who do not have to worry about business rates. In doing so, business rates are kept high because retailers are unable to appeal on the basis of rental value of their properties.

The example I gave where a client had to close due to the competition from 2 setparate charity shops that sold the same gifts as my client at a cheaper price. They could do so as they didn't have the [statutory] overheads of my client. It's rather like the NHS or schools sacking payroll staff because they can get retired volunteers to do the same work - the unions would rightly point out that livlihoods are being ruined by a state subsidised cheap labour.

From Allen Keep

Saturday, 14 January 2012

Here we go. Another topic driven off course by Mr T who, rather amusingly, appears to be bleating.

The incredible argument that charity shops ( in moderation of course) are responsible for driving retail rent up sounds perversely similar to the view that immigration causes unemploymnet.

Guess what David - the real problem is that it's "enterprising types" ( aka that "band of hostile brothers") sticking the boot into other enterprising types (otherwise known as capitalism) Sucks when you lose out doesn't it?

From Dave M

Saturday, 14 January 2012

What on earth have charity shops got to do with this thread?

From Myra James

Saturday, 14 January 2012

David, I don't understand your remark about charities which "go beyond the remit of taking in the odd bit of brick a brac or old clothes and try and sell them as a curio or simply for those who can't afford new". What's wrong with selling second-hand clothes to people who can't afford new ones? And what should happen instead to these clothes - consignment to landfill? Obviously it would probably be better if most had never been bought/manufactured in the first place (the madness of cheap, disposable fashion), but that's where we find ourselves.

I notice this thread has strayed rather a long way from its original intention! Never mind, I have little to say about the Fox and Goose but am a big fan of charity shops.

From David Telford

Sunday, 15 January 2012

@Allen Keep, I am sorry you think I've forced this off topic, it's not the case. There is of course an irony in your post but I'll leave that. I was simply giving an example of where organisations are given a comparative advantage to reflect altruistic aims and how this effects other businesses. I thought you would have understood this although I realise that you are especially slow.

There certainly isn't the need to be so egregious. I fully support the guys behind the move for the pub (as long as a fair deal is found with the current owner). I'm sorry to repeat myself but my only concern is that the pub, whoever owns it, should not be afforded a favourable status.

@Myra James, I agree with you, Charity shops are great for recycling clothes etc. My only concern is that some charity shops do not just sell 2nd hand clothes, bric brac etc but can sell a % of new items exploiting their status as VAT exempt, rate exempt etc etc which is unfair on those commercial businesses that do not enjoy such an advantage.

I relate it to the OP's point because they are considering applying for mutual trading status would give a potentially unfair advantage over other established businesses which IMHO isn't on.

From Andy M

Sunday, 15 January 2012

I think that it would be an excellent idea to have the F n G reborn as a co-operative pub.

I would recommend re-instating the pool table as the the old, much frequented pool room, still feels oddly bereft, and lonely without it!

Signed an ex-regular.

From Mark Simmonds

Sunday, 15 January 2012

To the best of my knowledge no-one involced in organising the public meeting about the Fox and Goose has even considered mutual trading status apart from my mentioning it in this thread, in passing, and then dismissing it as highly unlikely.

I'm enjoying the discussion around the role of charitable status in business and would engage with it in another thread, which is where I suggest it belongs.

Thank you to all those who have contributed so far, but we still don't have a good idea what people really think about this idea. If it goes ahead, it will involve a lot of work and commitment from a lot of people and it would be good to know some more aboutwhat the people of Hebden and surrounding area think about the Fox as a co-operative pub and what extra information they would like to know before deciding.

From Allen Keep

Monday, 16 January 2012

Apologies Mark, I should be focusing on saying that I think taking the Fox into community ownership would be an excellent idea.

I saw a community village shop in action in Northumberland recently (there were thoughts of taking on the village pub too) and it was really impressive. I've been a visitor to the Fox for very many years and I'm sure there is a place and a future for it.

Personally, I'm not sure I could make anything other than a very small investment. On the other hand I wouldn't expect or wish for any sort of return and I would be confident there would be more than enough people prepared to pitch in. The shop I mentioned relied heavily on people giving their time rather than money -sharing tasks, pooling skills etc - and although I am especially slow I would happily give some time to help out.

From Martin Firth

Tuesday, 17 January 2012

It's an idea well worth pursuing. I, like many ex-regulars, would love to see the pub revitalised. This would present an opportunity to be actively involved in that process and I would seriously consider helping to finance the project.

Of course there are many issues to be addressed, not the least of which is how the pub is run. I would envisage the "Co-operative" employing somebody to run the pub, either as a manager or, preferably, as a tenant. The day-to-day running of the business would be their responsibility and they alone would have to be left to get on with it. Obviously they would work to an agreed plan and targets and some system of periodic meetings would be arranged to address major issues and review performance. But NO casual interfering from "investors"!

This leads me to my second consideration. I feel that the number of "investors" should be kept to a minimum, about six maximum. The old adage "too many cooks..." applies. A few like-minded people would fair much better. Clearly funding will be a major determining factor, but the more people are involved, in my experience, the more you get personality and ego clashes and conflicts of ideas. The intemperate nature of some of the comments on this site perhaps bears me out!

I look forward to next Tuesday's meeting.

From Mark Simmonds

Tuesday, 17 January 2012

Don't forget the public meeting - one week from tonight.

Tuesday 24th January, 8pm at the Fox and Goose.

From David Teflord

Wednesday, 18 January 2012

@ Martin Firth - Co-operatives tend to be a lot more than 6 partners, otherwise it really is a partnership or maybe set up an LLP or Limited co. As you point out, the huge drawback is the too many cooks syndrome and then the most voiciferous tend to get their own way early doors and accusations of cliques & resentment start. Also, organisations set up with a view to making a profit often fail to make a profit, organisations that are without profit motive have even more chance of making losses, the members coulc well be looking at having to invest a little more, that is often when accusations of 'not doing it right' & even profiteering can come into it.

From Mark Simmonds

Wednesday, 18 January 2012

I'm sure it would be possible for six investors to club together and buy the Fox. I'm sure that the regulars would be glad that somone had saved the pub and had saved them the trouble. However Julia would rather the community were given the option first.

The examples of co-operative pubs we have so far typically have memberships in the hundreds and the members can include local people, other local businesses, maybe even breweries. This doesn't mean that 200 people have to meet everytime a barrel is changed. As has been pointed out, the day to day running of the business is generally in the hands of employed staff. The membership meet at least once a year at the AGM to receive/approve accounts and elect a committee which meets on a more regular basis. The committee has a similar role to the board of directors in any company, being responsible for the long term strategic direction of the business.

One advantage of the co-operative pub model over the few "angels" model is that it has hundreds of members who are now drinking in their pub, with a pride in and a loyalty to their local rather than a gratitude to the well off few. This gives co-operative pubs a competitive business advantage which no PubCo can emulate although some private landlords come close.

The other major advantage of the multiple co-operative shareholder model is that shares can only be sold back to the co-operative, whereas there is nothing to stop one or more of the "angels" selling a controlling interest to anyone else including a PubCo. Power in the co-operative model is on the basis of one member one vote irrespective of shareholding, whereas in the other models it's one vote one share - business as usual.

If you want to know more about this stuff (who wouldn't?) there's lots of good stuff on-line. Particularly the Community Shares project

And finally don't be put off with the claims too many cooks and inefficient running. There are good and bad co-operatives just as there are good and bad non-co-operative businesses.

Co-operatives, however, are one of the few well performing sectors in this current recession mainly due to the fact that they are not business as usual.

From Jim M

Thursday, 19 January 2012

Well you can be assured David Cameron will support you if he means what he said in his speech today. Cooperatives flavour of the month with his brand of Conservatives. And good luck to all involved anyway.

From Allen Keep

Monday, 23 January 2012

Good luck with the meeting - I won't be able to attend unforunately as I have a meeting elsewhere.

I hope you will keep people informed of the outcomes through hebweb and/or other means. I'm sure a lot of people will be interested to see what develops.

From Julia Warren

Tuesday, 24 January 2012

I am the present Owner of The Fox & Goose. I have visited and worked with many pub and Brewery Co-operatives over the years. They all run on a similar system by where the co-op' hire a manager or a couple as managers, the pubs are run the same as any other pub that has hired management. The co-op work together in the background but the main management of the pub's is done by the hired hand.

Co-operatives do not work in the same way as a charity and in no way do they manage to get away with the costs applied to any pub or business in the country.

The pubs and Brewerys that I know have now been running for a long time, they do not encroach on any other businesses in the community and do their best to run side by side helping out other businesses around the vacinity.

I do not know if this idea will work or even go ahead. I do however think it should be given the chance to try. I personally think its a great idea and would love to see the pub move toward this. This is something that is good for the community, not harmful and deserves all the support possible.

What is more harmful, anouther PUB CO pub? Don't they own enough of our pubs, or a one off Co-operative. I know which I would prefer.

From Martin F

Thursday, 26 January 2012

Good luck to Julia.

I hope the plans succeed - for personal reasons, since it is, in my opinion, one of only two pubs in Hebden that serve decent real beer!

From Cllr James Baker

Tuesday, 7 February 2012

I think taking on the pub as a co-op is an excellent idea. Of course it won't be easy, but I think everyone involved will be full aware of the challenges.

There will be plenty of expertise out there in the community ready to help.

From Anna R

Monday, 27 February 2012

There will be a meeting on Tuesday (28th Feb) in the pub at 7.30pm where the interim steering group will be elected. These people will be responsible for determining whether the project is able to go ahead and if so, setting up the cooperative. If you are interested you can nominate yourself by getting a form from the pub or by emailling us with no more than 100 words stating why you want to be involved by midnight Monday (27th Feb).

If you should like to be kept informed of developments then you can ask to be part of the mailing list if you email us or you can join the Facebook Group here.

From Pete Hayward

Friday, 16 March 2012

Don't forget folks - the first Fox Friends Friday Fund-raiser is on tonight at the Fox and Goose.

So get along there and enjoy your chance to sample a pint of Tod Blonde from the Benevolent Barrel and support the Fox Friends Co-operative bid at the same time.
The beer has been donated by Little Valley - and will hopefully be the first of many.

The Philanthropist's Pump will be flowing from around 7pm - so get there as early as you can as it's likely to run dry pretty quickly.

....'til tonight