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A Financial Fiasco (Financial Security in Hospitality) – Reflections of a Reluctant Landlady

Updated: Apr 17

As we settled into the rewards and challenges of running three venues, the differences between the two accommodation-led inns close to Stonehenge and our new busy boozer became increasingly clear.  We focused on improving customer service, trying to be more family friendly and food led, and improving the reputation that it had previously for being a ‘drug den’.  We quickly found that having a large vocal loyal customer base rather than our largely passing trade and tourist patrons, had its challenges.  But another key difference was this new venture was predominantly cash-based, a stark contrast to our previous operations and a shift that predated the COVID era's push towards digital transactions. In the wake of the distressing robbery I recounted in an earlier blog,  (, we decided we had to further improve our financial and personal security.

The visibility of our bank visits, with substantial deposits in tow, marked us as potential targets. To mitigate this risk, our white German Shepherd became a regular companion, offering a sense of security. We varied our banking routines – the timing, the person making the deposit, and even the bank branches we visited, especially after weekends busy with events or the rush of a bank holiday, which significantly increased our takings.

Seeking a safer avenue, we enlisted a reputable third-party firm. Their promise was enticing: a state-of-the-art safe that could detect counterfeit notes, enhanced security measures for our main office, and the convenience of weekly cash collections in exchange for a nominal fee. This arrangement not only promised to bolster our security but also to streamline our finances, consolidating our earnings into a single bank transfer and sparing us banking fees that almost covered its own cost. It was, or so it seemed, the perfect solution.

However, the smooth sailing was short-lived. A clerical mishap saw our earnings mistakenly deposited into another pub's account with a similar name. The ensuing debacle was not just frustrating; it was a stark reminder of the precarious nature of cash flow in the pub sector and, indeed, in many small and medium-sized enterprises (SMEs). The ten-day delay in reclaiming our funds, despite our persistent efforts and the recipient pub's assurances of a swift return, was a financial strain we were ill-prepared to bear.   We chased up at least once a day, but our money was not forthcoming at a time when we needed it, despite their weak promises and lame excuses.

We were very disappointed with the company’s refusal to put the money into our account, especially as it was their mistake, but we carried on using them as we were under a two-year contract.  Our patience was tested further when history repeated itself, casting a shadow over our payroll preparations.  The mistake took an emotional toll on us as we scrabbled about to meet our large payroll bill for the c50 staff we employed.  The company's repeated failures and their reluctance to immediately rectify their mistakes forced us to question the viability of our partnership.

When the same error occurred a third time, again citing the negligible difference in database entries as the cause, our patience wore thin. Again, we had to wait for the recipient pub to return the money before we received our money which took longer as their patience was wearing thin too.   So, we severed ties, a decision underscored by the definite breach of contract, and they couldn’t argue with our decision.

This experience, though fraught with challenges, offers valuable lessons. Having thousands of pounds of cash-flow tied up by a third party was never a risk we had identified, and if we had, perhaps we could have negotiated the terms of the contract differently.  It underscored the importance of stringent measures for financial-security-in-hospitality and other cash-rich businesses and the critical need for robust working capital – principles that hold true even as the digital age reshapes our financial transactions.

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Cute picture of a white German Shepherd with her ears pricked up

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