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JD Wetherspoon's Business Model


Submitted By PaMacq988
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Today JD Wetherspoon is one of the most well known pub chains in the UK and Ireland. With 35,000 people employed by the organisation and over 900 outlets it is easy to see why. They have grown significantly over the last 10 years as a new market for craft beers has opened up which Wetherspoons have taken full advantage of. They sell local craft beers and also well known brands at a fraction of the cost than most pubs in the industry. In the companies 2014 report it stated that it is the biggest purchaser of micro brewery beer and is supplied by over 400 micro breweries across the UK. The company is now publicly listed on the London stock exchange with owner Tim Martin still owning a large part of it. Wetherspoon has been an innovator in their respected industry and after gaining a stronghold in the pub industry they now own over 40 hotels across the UK which they like to call Wetherlodges. At the moment their hotels do not bring in half the money as their public houses do but there is room for expansion if the opportunity arises according to the founder Tim Martin. To add further to their innovation, they were one of the first to open their premises at 7am. Although you will not be able to get alcohol served. Wetherspoons did this to break into the breakfast market as alcohol sales were dropping. They have done very well in the breakfast market as consumers have endorsed the quality breakfast served at an affordable price. They are now in the top 3 of coffee sellers in the UK, selling over 25m coffees a year and competing with the likes of Starbucks and Costa coffee. This has brought their profits up 20% after the first eight months of it being introduced and has grown steadily since.

Wetherspoons are well known for their strong brand image which differentiates them from the rest of the industry. Not only do they sell alcohol and food at a cheaper price than anywhere else but their premises are unique. Their pubs are conversions of mostly old listed buildings like churches, theatres, banks and post offices which alone can make them stand out from the rest. You will find in their pubs that music is not played and the decoration is old fashioned and has a traditional feel to it. They were pioneers in having smoke free pubs. This was implemented two years before the government law was put in place. These reasons have made them stand out from the crowd and has got people interested in their services.

Wetherspoons do not just target one segment of the market as they cater for all ages and all walks of life. They are family orientated while also providing a service to students, older generation, party goers and professionals who stop by for early morning breakfast. The variety in their service has gained them huge profits by serving breakfast, coffee and food and alcohol till late. The promotions that they run are fun and keep customers interested. Examples of this are their weekday promotions like Mexican Monday, Steak Tuesday, Wing it Wednesday, Curry Thursday, Fish Friday. They hold annual ale festivals in March and a cider festival in the summer in which they serve a large range of guest drinks which gives them an idea of what drinks to introduce to their pubs at a later stage. This all fits into their brand image as a well run establishment which sets trends and people seem to enjoy it.

After dominating the UK, Wetherspoons have put a lot of focus into Ireland. Their first premises was opened in 2014 and is situated in Blackrock., Co. Dublin. In December that year another followed with the opening of an outlet in Dun Laoghaire and the year after in Swords. Just recently they have opened one in Cork city with further plans for outlets in Waterford, Carlow and a new hotel on Camden street in Dublin city. In early 2015, JD Wetherspoon stated that it was happy with the outcome of the first outlets in Ireland and was planning to invest a further 50 million into creating 30 more public houses in the country. This is great news for the Irish economy as it will create 1,350 jobs and will also create price competition with other competitors. This investment is included in the wider expansion plan which will see a total of 200 pubs opened in the UK and a total of 400 million invested in the next 5 years. By these statements JD Wetherspoon are in the industry to win and have shown no signs of slowing down.

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