Raising the bar in Germany

Source: The Irish Times.  Article by Caroline Madden

When Patrick Hunt emigrated in the early 1980s, he was following in the footsteps of 80 per cent of his classmates. But unlike his peers, it wasn’t unemployment that drove him to fresh pastures, but the need to stretch his wings and find bigger opportunities.

Hunt found the bigger canvas he was seeking in Germany, where he has set up three Irish pubs that now deliver a turnover of nearly €4 million a year. But before that, he spent years building up his experience in the food and drink business on the other side of the world.

After leaving school early, he went straight into an apprenticeship with the ESB. The merits of having a pensionable job were constantly drummed into him, but he “needed to get out” and experience the world. The day his apprenticeship finished he booked a flight to New York. After a short stint in the US, he took the less-travelled path (at that time) of heading to Australia, where he found himself running an Irish club in a small town in the outback of western Queensland.

“That was my first venture working in gastronomy,” he says.

Just as he was beginning to tire of the outback life, his mother posted him an Irish Times supplement on Irish pubs that were opening up all over the world. If it was an attempt to lure him closer to home, it worked. On the basis of information in the supplement, he succeeded in getting a job managing an Irish bar in Essen, the sixth biggest city in Germany. Rather than just pulling pints, he became very much involved in the food side of the business. Under his management the pub became “very, very successful”, and after finding a suitable location in Essen, he decided to open his own Irish bar called Fritzpatrick’s.

He has since opened two more Irish bars, one in Oberhausen and another in Moers. Staff levels across the three businesses run at about 25 full-time employees and 60 part-timers. He explains that the major difference between pubs in Germany and those in Ireland is the emphasis on food. Food sales represent about 30 per cent of his business, while beer sales are 40 per cent, and the remaining 30 per cent is generated from sales of cocktails, spirits, water and soft drinks. Most consumers in Germany, and indeed Continental Europe, go out for a bite to eat and might have a few drinks with their meal, whereas the reverse is true in Ireland, he says. Consequently pubs in Ireland have a much higher reliance on revenue from alcohol, but he prefers the German business model.“People don’t have to drink but they have to eat,” he says.

German consumers are also far more price conscious than their Irish counterparts, which makes for a “good, competitive market”. From a publican’s perspective, it also means that German consumers demand greater value for money, and would not tolerate the pricey pints – inflated by costly leases and loan repayments – being served up in drinking establishments in Ireland.

Since he set up his business over 10 years ago, Germany’s economy has moved in a different cycle to that of Ireland. While Ireland’s economy was expanding rapidly, Germany flatlined at zero per cent growth. The tables have now turned, and Germany’s economy is set to grow at 2 per cent this year. Hunt is quick to point out that this does not represent a boom. “Germany looks much better now compared to Ireland, [but only] because Ireland has gone down so much,” he says.

He describes setting up a business in Germany as difficult but feasible. “Language is a problem, and culturally it’s quite different, but there are opportunities everywhere you go,” he says. The key to success is not to take on the Germans at what they do best. It is a manufacturing nation, so there is little point trying to compete on that front, he suggests. Irish businesspeople must figure out where their strengths lie, such as the food industry, and then focus on those areas.

He believes it is much easier to operate a business in Germany than in smaller countries like Ireland, where cronyism is more likely to happen. “It’s very, very black and white,” he says of Germany’s business culture. Pre-agreed costs for things such as legal fees make transactions less expensive, while outmoded payment methods such as cheques are a thing of the past, and payments are always made on time.

Hunt has no regrets about giving up a pensionable ESB job when he was 20, and urges others to see the world.

“You find out how small Ireland is, perched at the edge of Europe. Anyone that goes abroad gets a different perspective on life and how to do things.”

 

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