What are the similarities and differences between operating a pub in Ireland and one in the US? On the opening of The Tap House in Ranelagh, someone who’s doing both - Irishman David Kelly - gave the matter some thought for Drinks Industry Ireland, assisted by his US colleague Angela Grogan, Senior Operations Director for the Group.
23 December 2013
David Kelly lives in Waterford yet manages to fulfil his role as the Co-Founder and Managing Director of the RíRá Group of Companies operating 11 Irish pubs in the US. With RíRá his goal was to replicate the true Irish pub from original salvage bought here and shipped over to the US.
“That set the template and then we’d to be operationally mindful of delivering a similar level of authenticity of service,” he adds.
Having worked for Guinness for many years before heading off with the brand to the States (and returning home again some 10 years ago this Autumn) he’s just opened his first pub here in Ireland.
The Tap House is situated in the former Russels of Ranelagh premises in South Dublin and as it’s only just getting started in Ireland he can only give his initial impressions.
Like the Irish model, the US pub business has moved on in tandem with the consumer. But he’s found that similarities exist between both on-trades. And of course some differences too…
With all the changes in consumer dynamics, pubs shouldn’t forget what they are, says David who believes that pubs here more accurately reflect that sense of community.
On the other hand he feels that bars in the US provide better food and standards of service.
“The US also tends to offer better product presentation with the exception of Guinness which is excellently done in Ireland,” he says, “The bottom line is that one has to provide a good service and a good experience for the consumer with attention being paid to some of the local differences.
“VAT is a lot higher here than Sales Tax which ranges State-to-State from zero to 6% or 7%,” he observes.
“There are obvious differences in that regard in terms of the rates, VAT levels etc but the bottom line is that from a consumer perspective there aren’t huge differences in what we’re trying to deliver.”
The food & drink experience
For publicans in Ireland food is challenging because the consumer here wants a food component to what traditionally had been a wet house whereas in the States it would simply not be legal for a wet house to exist.
“In Maryland, food forms 50% of our turnover. Americans socialise around food. In Ireland there’s a tendency for consumer behaviour to be regarded as being around one of drink and this tends to separate the pub experience from the restaurant experience. But successful operators here are all very good budget managers; food operators in this sector are superior to many other markets and ahead of where many think they are.”
David explains, "“In the past here the pub experience was followed by the food but now there’s a convergence, an opportunity for operators to offer a food and beverage experience which adresses itself both to restaurants as much as to pubs."
The Tap House intends to adress this convergence.
David also emhasises the importance of wine penetration where, curiously, he regards the share of wine sold in pubs here as much higher than in the US.
Proliferation of product
From David’s US experience he can see that product proliferation is here to stay.
“It’ll only get more chaotic which is an operational challenge for pubs as customers seek multiples of brands in all categories – craft beer, whiskey, vodka etc,” he says.
“But it’s the extent of product proliferation in the US. Ireland is moving along the same trend-line but we have US pubs with 150 whiskeys and 150 craft beers and we’re not the leader in terms of expansive offer.
“Labour costs are much lower there too with the tipping culture keeping costs down and service standards up.”
Angela Grogan, Senior Operations Director with the Group, adds, “The licensing hours are much easier and more flexible in the US. Later hours are there if you want them and they don’t require a special licence.”
The RíRá Group hires “industry professionals” from Ireland (experienced hospitality personnel, graduates and/or those with a couple of years’ experience) on a J1 Programme for a year to facilitate people who’re committed to the hospitality industry.
“They do a year with us in the US where the hospitality industry is different to here, where front-of-house incomes are delivered to a great degree by the hospitality deliverer in the form of tipping,” explains David.
And now, the opening of The Tap House may give David’s US staff a chance to experience an Irish pub for themselves right here in Ireland.