Business Plan Template for UK Pubs

Last updated: 2 May 2026

Most first-time pub licensees spend more time researching the history of their local boozer than they do forecasting whether it will actually make money. That’s backwards. You’ll walk into a pubco office, hear a compelling story about wet sales and community events, sign a lease, and six months in you’ll realise nobody told you how much your labour costs actually matter, or what happens when a tied keg costs 30% more than free-of-tie. A proper pub business plan template isn’t just something banks want to see — it’s a reality check that keeps you from becoming another failed licensee statistic. I’ve been where you are. When I took on Teal Farm Pub in Washington NE38 three years ago on a Marston’s CRP agreement, I had decades of hospitality experience but I still needed to answer hard questions about cash flow, staffing ratios, and whether the numbers actually worked. This article gives you the framework I wish I’d had, broken down into sections you can use immediately.

What a Pub Business Plan Must Include

A pub business plan is not a generic small-business template copied from Companies House guidance. Pubs operate differently from restaurants, cafés, or retail shops. Your plan needs to address the specific financial realities of holding a tied lease, working with a pubco, managing wet and dry sales separately, and handling the unpredictability of customer footfall on match days versus quiet Tuesdays.

Start with these core sections:

• Executive Summary: One-page overview of your pub concept, target market, and projected profit in years one, two, and three. Banks and pubcos read this first and often skip the rest.
• Market Analysis: Who drinks in your pub? Are they estate workers, office staff, families for Sunday lunch, or sports fans on match day? What’s the demographic of your postcode versus the pub’s current customer base?
• Operational Model: Hours of trading, number of staff, food service (if applicable), events (quiz nights, match days, live sport). This directly affects your revenue forecast.
• Financial Projections: Three-year forecast of sales, costs, and gross profit by category (wet, dry, food, machines if applicable).
• Tied Tenancy Terms: Specific costs tied to your agreement. Product markups, tie-in periods, break clauses, dilapidations clauses, and your rent/management fee arrangement.
• Staffing Plan: Names and roles of permanent staff, hours, wages, national insurance, and how you’ll cover sick leave or holiday cover.
• Cash Flow Statement: Monthly forecast for the first 12 months. This is where most plans fail — they show profit but negative cash flow because money’s stuck in stock or tied up in late customer payments.

A strong business plan also includes a section on pub business rates and non-domestic rates, which vary wildly by location and are often underestimated by new licensees. That’s a cost that doesn’t change with sales volume, so it has to be in your fixed overhead forecast from day one.

Financial Projections and Profit Forecasting

The most effective way to forecast pub profit accurately is to split revenue into wet sales, dry sales (food), and other income (machines, functions, or retail), and forecast each separately with different gross profit margins.

Here’s the reality: wet sales (draught beer, lager, spirits) typically generate 65–70% gross profit. Food might be 40–50%, depending on your menu. Machines are 85%+ margin if you run them. If you lump everything together as “sales” and apply an average margin, you’ll either over-forecast profit or miss opportunities in lower-margin lines.

Use a pub profit margin calculator to work out realistic margins for your specific tied agreement. Here’s what you need:

• Actual pubco prices for your tied keg brands (Guinness, Carling, etc.) — not national averages.
• Your retail prices on those brands.
• Waste and shrinkage assumptions (most pubs forecast 4–8% waste on draught).
• Whether you’ll discount or run promotions, and what that does to margin.

When I took on Teal Farm Pub three years ago, my initial forecast assumed tied draught margins that were 8% below what I actually achieved once I understood the pubco’s discount structure for volume purchases. That single error nearly cost me my contingency buffer. The difference between assuming a margin and knowing it from your actual supply agreement is the difference between a useful plan and a fairy tale.

For food, be conservative. Most pubs overestimate food revenue because they assume customers will buy more meals than they actually do. A tied pub in a residential area might run food service at 15% of total sales. A town-centre sports bar might be 35%. Know which one you are.

Understanding Tied Tenancy Costs

This is where most first-time licensees get blindsided. A tied tenancy means you must buy your products from the pubco. In return, you get lower rent than you’d pay on a free-of-tie lease. But the maths are not always as straightforward as the pubco representative suggests.

Tied tenancy costs lock you into higher per-unit product costs because the pubco’s wholesale price to you already includes a margin they’re retaining — they’re your supplier and landlord simultaneously.

Your business plan must include:

• Actual cost per pint for your tied brands (not the draught margin — the actual cash per pint). On a 4.5% ABV lager, a typical tied cost might be £1.20–£1.50 per pint depending on volume and discounts.
• Breakdown of core brands (your mandatory tie) versus guest taps (if your agreement allows them). Most Marston’s CRP agreements allow one or two guest casks, which you can source free-of-tie and sell at better margin.
• Comparison to free-of-tie pricing in your area. If free-of-tie draught costs £0.95 and tied costs £1.35, that 40p difference compounds fast on a 100-pint week.
• Your rent or management fee as a percentage of net profit. Some pubcos charge percentage rent, some fixed rent. Know which your agreement is, because it affects your break-even point.

I was fortunate that Marston’s CRP is relatively transparent about costs. Still, when you sit down with the printout of your tied prices and run them against free-of-tie benchmarks, you’ll feel the squeeze. That’s normal. Your business plan has to account for it as a real cost, not hope it away.

Labour Costs and Staffing Models

Labour is your second-biggest cost after product, and it’s the one that varies most wildly between quiet nights and busy periods. Most pubs work to a target of 25–30% labour costs as a percentage of sales. I run Teal Farm at 15% against that benchmark — but that’s because we’ve engineered specific staffing models for different trading patterns and invested in systems that reduce waste.

Your business plan should forecast labour in multiple scenarios:

• Quiet period staffing: Monday–Wednesday, off-season. What’s your minimum team to open the door safely and legally? Two staff? One? Labour cost on a £300 trading day versus £800?
• Standard week staffing: Thursday–Sunday normal trade. Your core rotas with permanent staff at standard hours.
• Event staffing: Match days, quiz nights, bank holidays. How many extra hours? At what rate? Who do you call in?

Don’t just count wages. Include national insurance (currently 8% on earnings over £12,570 per employee), pension contributions if applicable, and training costs. A single hire costs you at least £500 in recruitment and induction before they’re productive.

You’ll also want to consider pub staff rota legal requirements — working time regulations, minimum rest breaks, and national minimum wage. These aren’t optional costs; they’re legal minimums that have to be in your plan.

The single biggest labour mistake I see new licensees make is hiring too many permanent staff in month one, then discovering their customer base is smaller than the outgoing licensee’s was. You can’t easily cut hours later without demoralising the team. Start lean, forecast a 10% buffer for training new staff in peak periods, then hire permanent hours only once you’ve proved the trade exists.

Cash Flow Planning and Working Capital

This is where business plans die. A pub might be “profitable” on paper in month three, but if you’ve spent £8,000 on stock in month one and customers pay cash but suppliers want weekly settlement, you’ll run out of cash on day 35.

Your monthly cash flow forecast must model:

• Cash in: daily takings (not revenue, but cash received). If you take credit cards, subtract the processor fee (typically 1.2–2% for pubs).
• Cash out: stock purchases (weekly), staff wages (weekly or monthly depending on your agreement), rent/utilities, insurance, rates. Tied pubs often pay stock on invoice with 7–14-day terms, so you sell stock before you pay for it — that’s good. But you need the stock upfront.
• Opening float: how much cash do you need to open the doors? Stock purchase, training costs, signage, equipment repairs, rates deposits, and licenses can easily exceed £5,000 in month one.
• VAT liability: if you’re VAT-registered, you collect VAT from customers but pay it to HMRC monthly or quarterly. That’s a timing issue in your cash flow — money owed but not yet due.

A realistic cash flow forecast for a tied pub shows negative cash flow in months one and two (you’re buying stock and paying for induction), then positive months three onwards. If your plan shows positive cash flow from day one, you’re either underestimating costs or your opening stock requirement.

Before you sign anything, know your numbers. The Pub Command Centre gives you real-time financial visibility from day one. £97 once. It tracks your actual cash position against forecast, so you’ll know within a week of opening whether your plan is holding or cracking.

Building Contingency Into Your Plan

Every pub business plan needs contingency lines for things that will go wrong. Not might — will.

Your HVAC breaks down. A member of staff leaves suddenly and you hire someone at short notice at higher cost. A customer slips and you’re defending a personal injury claim. The pubco introduces a new product mandate and you have to clear old stock at discount. Suppliers increase prices (draught cost inflation is typically 3–5% annually). The local football team gets relegated and your match day revenue drops 40%.

Build these into your plan as:

• Operating contingency: 10% buffer on variable costs (food, stock waste, additional labour).
• Capital contingency: 5–10% on any equipment, refurbishment, or stock investment you’re making upfront.
• Reserve fund: First 12 months profit should partially go into a reserve for equipment failure or unexpected costs, not straight to your pocket.

A business plan that assumes everything goes perfectly is not a plan — it’s a fantasy. Lenders and pubcos know this. They’ll reject plans with zero contingency because they signal you haven’t thought through real-world risk.

When I forecast Teal Farm, I modelled three scenarios: conservative (85% of projected trade), realistic (100%), and optimistic (120%). I planned for the realistic scenario but was prepared for conservative. We hit realistic in year one, then exceeded optimistic in 2025. That preparation meant I had headroom, not panic.

For more information, visit retail partner earnings calculator.

For more information, visit best pub EPOS systems guide.