Expert Advice on Hospitality Topics

Nick Kaoukis

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Bar Management Tips: Making Each Customer Count

Posted by Nick Kaoukis on Thu, Sep, 06, 2012 @ 10:09 AM
By Douglas Robert Brown
Atlantic Publishing
 

Bar CustomersYour market and competitor research will likely reveal that most bars that are successful pay a lot of attention to customers. In fact, great service is one of the surest ways of drawing repeat customers. To draw more patrons to your bar on a regular basis, you do not have to spend a lot of money. However, you do have to think like a customer; you will likely notice a few things that need to change at your establishment:

  • Waiting lines. If there's a line outside the door, all it takes is a little creativity to either bring the line inside or disguise it on the outside. Remember, those people waiting outside are probably thirsty and they'd be more than happy to do their waiting in a courtyard area, at a temporary bar, or in a cordoned-off outside area where drinking is permitted. Of those who are prepared to brave the line, most will do so gladly if they know they can be inside within 30 minutes. Also, it's simple to change waiting-time perceptions by making that wait a little more comfortable or entertaining.
  • Parking can be a big hassle in many venues. If there tends to be a traffic jam outside your venue, consider installing a valet service on busy nights or posting a staff member outside to direct patrons to parking around the back or down the road. Signs pointing to parking areas also help.
  • Offer creative extras. Whether it is free hand massages, glow sticks, or a live band outside, making the outside dazzling will make people all the more eager to see the inside of the bar.
  • Think about your TV screens and sound system in relation to your waiting area. Can waiting people catch a glimpse of the big game? Can they hear the music inside? These things will keep a waiting person keen on staying around, whereas a blank brick wall and a disinterested bouncer isn't inviting to anyone.
  • Keep clientele informed. If there's a wait for a table, set up an electronic sign indicating how long their expected wait will be. Add to this anything you can think of that will make their wait more entertaining—sports scores, trivia questions, coming events. It might be a little more work, but if you can keep just five people from leaving, it'll be worth it. 
  • Freebies and incentives. Offer your waiting patrons a little something extra and they won't just "not mind" waiting, they'll do so gladly. Coupons to be used on a later date are a good option.
  • Create a waiting area if you know that there tends to be a wait to get into the bar. This can include comfy chairs or an outside patio where customers can wait and sit. This is a great way to make sure that customers do not get tired and leave.
  • It doesn't have to be expensive. Giving your waiting customers something to do doesn't have to be expensive, high-tech, or take up your employees' valuable time. Consider offering free reading material in your waiting area or even Internet access.
  • Act first. A long wait doesn't seem quite so long when a staff member keeps you informed on how long your table will take. Don't wait for the customer to ask you; go out and tell the customer.
  • Make your bar irresistible. Why will some bar patrons wait forty-five minutes to get into a bar instead of giving up and going elsewhere? They have a sense of urgency to get inside. Whether you are offering a hot live act, celebrities, or some other enticement, make sure it is worth the wait
  • Offer free appetizers to waiting patrons. A tray with a nice selection of different foods from your menu can actually be a great advertisement and may even generate increased food sales.
  • Supply your customers with pagers. Offering waiting customers a pager to notify them when their table is ready is a great alternative to the usual "public address" announcement or a yell over the crowd. When a table becomes available, your host simply dials the waiting customer's number, and wherever they are in the building (or outside), they know that their table is ready. 
  • Build suspense. If it appears as though there is something really exciting going on in your bar, people will be willing to wait to get inside.
  • Make sure waits are fair. Patrons who have been waiting for a whilewill get rightfully angry if it appears as though the staff are letting in people who are paying extra or who are simply "flirtier." Make sure that your security staff respect the queue and try to get everyone inside in an orderly and fair manner.
  • Keep your customers informed. Be honest. If there'll be a half-hour wait, don't tell them it will be a fifteen-minute wait and hope they don't walk out. Similarly, ensure your staff keeps them updated on the wait so they know they haven't been forgotten. Small things like this make a big difference in the eyes of a waiting customer.

Customers are your mainstay in the bar business. If you treat them better than other bars would, you are ensured repeat business. Customers love to feel like VIPs, and the more patrons you make feel like this, the more business you will have. Share these tips with your staff to ensure they treat every customer as through he or she were a star.

 

This article is an excerpt from the The Professional Bar & Beverage Managers Handbook: How to Open and Operate a Financially Successful Bar, Tavern and Nightclub, authored by Douglas Robert Brown, published by Atlantic Publishing Group. This excerpt has been reprinted with permission of the publisher. To purchase this book go to:

Atlantic Publishing Company
Amazon.com

Topics: Technology, bar profitability, NightClub Management, bar supplies, bar business, Bar Management, Nightclub Consulting, opening a bar, bar location, Hospitality, Bar Promotion

Bar Management Tips: Fill a Local Need

Posted by Nick Kaoukis on Mon, Aug, 27, 2012 @ 08:08 AM
By Douglas Robert Brown
Atlantic Publishing
 

busy barThere are many bars that go out of business each year. This is because the market for new bars is a challenging one. If you are in an area that has new bars opening all the time and a clientele who is always seeking the latest thrill, you need to work extra hard to ensure that your establishment stays exciting enough. There are many small details that can mean the difference between a bar that is merely surviving and one that is prospering beautifully. In this chapter, you will learn the small details that can push your success higher than ever. Not all of these tips are expensive. Many take only ingenuity and some effort, but the results can be spectacular!

Distinguishing Your Bar from Others

One of the first steps to ensuring that your bar is a success for a long time to come is to look around and make sure that you are offering value in the local area. Most of your business will be from people who can easily drive, walk, take a cab, or ride a bus to your bar. These same patrons will have the choice of many other bars in the area. There are a few ways to make sure that they select your bar:

Research the competition. Take the time to sit in every competing bar. After you order your drink, take notes: Who frequents these bars? Older patrons? Younger patrons? Yuppies? Tradespeople? What sort of bar is it? How much do they charge? What does the bar look like? What are the drinks and food offered? What are the promotions? What kind of entertainment is offered? How busy are they and on which night are they busiest? What are they doing wrong? What are they doing right?

Consider lower prices. If your competitors' prices are high, consider lowering yours. It will often get people to try your establishment for the first time. Your service and the quality of your bar will decide whether
they return.

Service. If your bar is known as the friendliest bar in town while your competitors tend to slack on service, you will make a profit. If your competition is already offering great service, you have to make your service stellar in order to compete.

Focus on what the competition is doing wrong. If you notice something that the competition is doing wrong, make sure that your bar is doing that same thing right. It will encourage patrons to see your bar as the local establishment that offers more.

Set your hours to take advantage of times when your competition is not available. If the competition stops food service early, think about extending your food service hours. Being able to provide something that the competition cannot or is not willing to provide is a great way to make sure that you lure in new regulars.

Do you know what the local patrons want? If you do not ask them and conduct regular market research, you have little hope of knowing the very things that will draw patrons to your bar.

Look at the bars that are succeeding elsewhere. What works in other cities and towns may work in yours. Pay special attention to the types of bars that are doing well in areas similar to your own (in towns or cities with the same demographics). These bars may have hit on an idea that may work well in your area as well.

Special promotions. Avoid using your best ideas and resources trying to compete on someone else's strongest night. Offer special promotions and discounts on nights when other bars are not offering anything. It will help lure in customers looking for something great on a slower night.

Remember, if you can offer something special, you are more likely to get more customers. It pays to make the extra effort to find out what is needed in your area—and then supply that need. Customers will flock to you.

 

 

This article is an excerpt from the The Professional Bar & Beverage Managers Handbook: How to Open and Operate a Financially Successful Bar, Tavern and Nightclub, authored by Douglas Robert Brown, published by Atlantic Publishing Group. This excerpt has been reprinted with permission of the publisher. To purchase this book go to:

Atlantic Publishing Company
Amazon.com

Topics: nightclubs, NightClub Management, bar business, Bar Management, Bar products, Nightclub trends, opening a bar, Increasing Profits, bar location, Bar Promotion

Loss Prevention: The Bar Manager's Key to Quick Profit Growth

Posted by Nick Kaoukis on Thu, Aug, 16, 2012 @ 13:08 PM

How Keeping Close Tabs On Your Liquor Supply Can Both Cut Costs & Generate Revenue

Inventory ControlIndustry studies have consistently shown that a full 25% to 30% of a bar's liquor inventory never converts into registered sales. That is the equivalent of about six to eight 1.25 oz portions per bottle (which should yield at least 25 portions.) This loss of liquor volume--due to unauthorized comps, over-pouring, spillage or theft--should be of great concern to any bar manager. 

While losing 25% of a $25 bottle may not seem like a very serious problem--an unavoidable cost of doing business--the true cost is much greater than that $6 or $7 per bottle. The question you need to ask yourself is: Where is this lost liquor going? And how is it affecting sales? For instance, if your bartender is not pouring 1.25 oz portions, but is instead pouring 2 oz portions (say, perhaps, to curry favor with clients and receive a bigger tip), you're not just losing liquor volume, you're also losing potential sales. Where the customer may have been disposed to buy three drinks (3.75 ounces), he may now be content to buy just two 2-ounce drinks. Your bartender's actions, in this case, haven't merely cost you a dollar's worth of liquor, they may well have cost you $6-$8 in lost sales revenue (depending on how you price your drinks). And that's just for one customer buying two drinks. How often is this occurring? What if your bartender also happens to be giving away free drinks without your knowledge or authorization? The point is: "shrinkage" does not only affect supply costs, it can also affect revenues in a big way. 

That's why loss prevention is so important. The profitability of your business depends on whole bunch of variables--the location of your establishment, the overall economy, ever-changing customer tastes.... Achieving profit growth can be difficult and can rarely be accomplished overnight. Increasing the price of your drinks is risky, and can prove more harmful than helpful as far as your bottom line is concerned. And growing your clientele usually takes time. The best way to increase profits in the short-term, therefore, is not to try to fiddle with pricing or to increase your client base. (Of course, this is something you should always be doing. But it is not easy to do in the short-term.) The quickest way to increase revenue is to make the most of the clients you're already serving. And one way to do this is to improve operations by getting tighter grip on your inventory. Loss of liquor supply at double-digit levels is not an "unavoidable cost of doing business". It is "bad business". And it is entirely avoidable. Put simply, loss prevention can pay big dividends. What's more, it can be achieved quite quickly through the implementation of a quality liquor inventory control system.

Topics: liquor inventory, Bar inventory, bar inventory levels, bar efficiency, bar profitability, Bar Management, Liquor cost, Liquor Inventory savings, alcohol cost, Increasing Profits, Reducing Liquor Costs, bar control, inventory control, managing liquor costs

Myths About Managing a Bar That Could Hurt Your Business

Posted by Nick Kaoukis on Thu, Aug, 02, 2012 @ 16:08 PM
By Douglas Robert Brown
Atlantic Publishing
 

Myth: Bartending School Is Vital for a Bartender

FalseMany of the best bartenders learn most of their useful trade while at work. This is because bartending schools vary widely in quality. Some emphasize the preparation of rarely requested drinks without stressing useful skills such as bar management, customer satisfaction, and customer safety. If you are hiring a bartender, you should consider the school he or she has attended, but testing practical skills will give the best clue of how many useful skills the person has for waiting on your bar. If you are considering attending a bartending school, investigate the school to make sure that you will be taught skills such as organization and techniques of serving. A good bartending school or course will emphasize dealing with customers. Be wary of a bartending school that is more of a "drink mix" school, stressing mixing many types of drinks without teaching anything besides drink preparation. There are many of these sorts of schools out there, which claim that a bartender's greatest asset is knowing how to mix an endless variety of drinks. Learning to mix the latest drink is relatively simple once one looks up the recipe, and most patrons will order the most popular drink of the moment rather than some obscure mix. A bartender with a good grasp of people and basic bartending techniques is usually more useful than the bartender who only knows how to mix hundreds of drinks from memory but has few skills besides. In some cases, an employee with a hospitality degree is better able to handle the bar job than someone who has attended a bartender school.

 

Myth: If You Hire Experienced Employees, There Is No Need to Train Them

 You still need to train your employees to ensure that they understand what you want them to do. In cases where an employee has worked at another establishment for a while, you may actually need to provide additional training to allow the employee to get used to the way you want things done versus how they did things at their previous job.

 

Myth: Hiring Younger Serving Staff Is Best

Many bar managers mistakenly believe that hiring young female servers will help ensure a high customer loyalty. This is based on the belief that middle-aged men are the main patrons of bars, which is no longer the case. When hiring servers or other staff, you should consider experience and skill over age or physical appearance. In most states, hiring based on age or appearance is discriminatory and can lead to lawsuits.

 

Myth: The Customer Is Always Right

Bar managers want the customer to be happy enough to return and satisfied enough to recommend the establishment to others. It is never wise to argue with a customer, and if the difference of opinion is something quite small, it is better to humor the customer in order to avoid making him or her feel embarrassed. On the other hand, if the customer insists that he or she is not intoxicated and can drink more, for example, then they should be refused further drinks.

 

Myth: Security Staff Is Vital in Today's Bar

Security does add a certain peace of mind, but at many establishments, it is still the bartender who acts primarily as the security force of the bar. Where your security comes from depends on your location and bar. If you decide you do not need a separate security staff, however, make sure that the bartender or some other personnel are willing to help customers in case of an incident.

 

Myth: To Run a Successful Bar, Just Serve Great Drinks

While quality drinks are a key to bar success, many people go to bars to spend time with others. If you serve good drinks but offer exceptional atmosphere and service, you are likely to do well. In today's competitive world, great drinks alone are not enough. Bar managers need to have good financial planning and careful advertising and marketing and offer great customer service in order to be a success.

 

Myth: You Can Cut Corners to Increase Profits

Reducing costs or cutting corners (reducing the size of drinks or firing staff) is unlikely to help. Customers expect more from bars than ever before. Offering them less is unlikely to bring you the results you want. If you are just starting out, it may take months to see a profit. If you have been in business for a while, increasing customers and getting more from each customer by encouraging spending and lingering are far better strategies than downsizing in order to make a profit.

 

Myth: You Must Keep Expanding in Order to Make a Profit

Many bar managers think that in order to make a large profit, they need to dabble in everything. For this reason, many bars spend large amounts of money setting up dance floors, live acts, larger establishments, and restaurants. When you are just starting out, though, it is often best to keep things simple. Do not expand randomly, assuming that spending more money will bring in more money. Only expand after careful research and weighing the potential risks and benefits. You do not want to get into debt for a venture that is unlikely to work for your bar.

 

 

This article is an excerpt from the The Professional Bar & Beverage Managers Handbook: How to Open and Operate a Financially Successful Bar, Tavern and Nightclub, authored by Douglas Robert Brown, published by Atlantic Publishing Group. This excerpt has been reprinted with permission of the publisher. To purchase this book go to:

Atlantic Publishing Company
Amazon.com

Topics: Bar staff, bar profitability, NightClub Management, bartenders you can trust, bar business, Bar drinks, Liquor cost, Bar products, drink recipe, liquor products

Managing Liquor Costs to Achieve Maximum Profitability

Posted by Nick Kaoukis on Thu, Jul, 26, 2012 @ 09:07 AM
By Elizabeth Godsmark
Atlantic Publishing
 

The Basic Mathematics of Profitability

Liquor Cost ControlA typical beverage operation generates a constant stream of data and information, endless columns of figures and daily records. But you'd be surprised how few managers actually do anything with these figures, let alone fully grasp their implications. So how can you tell if you're operating profitably? The answer is you can't, unless, of course, you get to grips with some basic mathematics. For a start, you'll need to know how to perform a few simple calculations, such as working out an item's cost percentage. You don't need to be a mathe­matician to figure the following straightforward formulas:

  • Cost per ounce. This is the basic unit cost of a drink. For example, to calculate the cost per ounce of a liter bottle, divide the wholesale cost of the bottle by 33.8 ounces, or in the case of a 750ml bottle, by 25.4 ounces. The figure you arrive at is the cost per ounce.
  • Cost per portion. To be able to price a certain drink, you must first calculate the base cost of the serving. Use the cost per ounce to work out the cost per portion. For example, if the cost per ounce is $0.60 and the recipe requires 1.5 ounces, then the portion cost is $0.90.
  • Cost percentage. Master this formula. You cannot function without it! To calculate the cost percentage of an item, divide the product's cost (or portion's cost) by its sale price and then multiply by 100. This simple calculation gives you the cost percentage. Profitability hangs on this key calculation. This calculation is the most frequently used formula in the beverage industry. It indicates the profit margin of any drink and represents the difference between the cost of the item and the price for which it is sold. If cost percentage increases, profit margins decrease..

Measuring Bottle Yield

You know the theory: to obtain the cost per ounce, you must divide the cost of the bottle by the number of ounces in the bottle. Fine, so far. But sometimes, in practice, the final sales volumes and profits can seem disappointing. You're confused because you have done everything by the book, and now, somehow, the figures don't quite add up. Get wise.

  • Consider evaporation and spillage. When calculating a bottle's cost per ounce, the secret is to deduct an ounce or two up front, before dividing, to allow for evaporation or spillage. Although this will slightly increase the cost per ounce, it will also give you a more realistic starting point.
  • Calculation errors. Slight variations can easily creep into a calculation involving both liters and ounces. For example, assume a highball contains 1-1/2 ounces of spirit (or 45ml): using ounces, a liter bottle yields 22.54 measures, whereas, using milliliters, the bottle gives 22.22 measures. Tip: "round down" in the interests of reality.
  • Maximize potential yield. You know that a bottle of liquor yields so many measures at a certain cost. However, you also know that sloppy pouring methods can wipe out potential profits. The best way to overcome this problem is to standardize portion serving as much as possible. You've paid for the liquor and want maximum returns.
  • Buy big. High-turnover liquor, wines and spirits should always be purchased in larger bottles for better yield per measure.

Gross Profits: The Lowdown

There is no better indicator of a business's success than its gross profit figure. By definition, gross profit is the cash difference between an item or portion cost and its sales price. All attempts to reduce costs should focus on this gross profit figure. Get to grips with how to figure out some important calculations related to gross profits.

  • Gross profit. To calculate a drink's gross profit, simply subtract its portion cost from its sale price.
  • Gross profit margin. This figure represents the percentage amount of profit made by the sale. Divide the amount of profit by the sales price and then multiply by 100. The result is the gross profit margin.
  • Sales percentage profits. To calculate the selling price (based on the required gross profit margin), divide the portion cost by the gross profit margin percentage "reciprocal," i.e., the figure you get from subtracting the target gross margin from 100.
  • Cost multiplier. This calculation is often used in the beverage industry to figure out the target selling price for a drink based on its portion cost. Divide the cost percentage you require by 100 and then multiply the result by the portion cost of the product.
  • Mixed-drink prime ingredient costing. A calculation used to determine the target sales price for a mixed drink that has only one main ingredient, such as gin and tonic or scotch on the rocks. All you have to do is divide the drink's portion cost by the target cost percentage.

This article is an excerpt from the Food Service Professional Guide to Controlling Liquor Wine & Beverage Costs, authored by Elizabeth Godsmark, published by Atlantic Publishing Company. This excerpt has been reprinted with permission of the publisher. To purchase this book go to:

Atlantic Publishing Company
Amazon.com

Topics: liquor inventory, Bar inventory, bar efficiency, bar profitability, NightClub Management, managing liquor inventory cost, Bar Management, alcohol cost, bar control, cost control, inventory control, managing liquor costs

Pricing Drinks to Optimize Profits

Posted by Nick Kaoukis on Thu, Jun, 28, 2012 @ 08:06 AM
By Elizabeth Godsmark
Atlantic Publishing
 

Establishing a General Pricing Plan

Pricing StrategySensitive pricing can make or break your operation. Pricing decisions should never, ever, be made arbitrarily. It is crucial to achieve that fine balance between pricing for optimum profits and making customers feel that they're getting value for money. Of course, you want to sell the drinks at their optimum sales volume, but if you tip the balance by raising the sales price too high, the sales volume will actually drop. So will the profits.

  • Research target audience. Investigate your potential market. Check out the opposition, even if this means visiting every liquor outlet in your locality. Get a feel for how much guests are prepared to pay for certain types of drinks.
  • Compete. A realistic view of market positioning is essential. Aim to match, beat or pitch for exclusivity (known as a "highball decision", in the beverage industry). All three methods can work. What won't work is a "muddling along" approach. Make a decision, set your goals and price accordingly.
  • Type of operation. Customers' image and perception of your establishment play a major role in establishing a pricing structure. Guests have fixed expectations about costs. For example, they expect to pay above-average price at a smart nightclub or "adult" establishment. They expect neighborhood bars, on the other hand, to be cheaper. Devise a pricing strategy that meets customer expectations.
  • Portion costs. You may have done your research and drawn up the perfect plan to wipe out the opposition, but, if you haven't "bought in" at competitive prices, you're not going to win. Keep portion costs to a minimum by buying low.

Take a Fresh Look at How You Apply Your Pricing Strategy

Having carefully considered all aspects of your pricing strategy, including cost, availability, competition and target audience, it is essential to make your pricing plan as user-friendly and easy to operate as possible. Simplify.

  • Price lists. A complicated price list with too many options and variables leads to employee confusion and incorrect charging. Even if those errors result in higher gross sales, customers will soon complain and you will lose business.
  • Devise main price categories. Group products according to their wholesale costs. Use standard increments, like 50 cents, to separate price categories.
  • Keep drink prices based on quarters. Prices ending in quarters - $0.25, $0.50 and $0.75 - are easier for bartenders to add up mentally.
  • List product prices with their corresponding specific portion size. For example, alongside each item in the liquor inventory, list the appropriate portion size for that drink.
  • Point-of-sale system. Make bartenders' lives a whole lot easier! Invest in an automated system, where a few keystrokes are all that's required to find any drink or item on the price list.

Markup: Where to Pitch It

There are no standard markup guidelines in the beverage industry. Unfortunately, getting it right is very important. Profitability, cost control and so much more hang upon those difficult markup decisions. Here are a few guidelines to point you in the right direction:

  • Broad guidelines. You need to start somewhere. The following markup suggestions may help:

Cocktails......................................... 3 l/24 times cost

Other liquor......................................... 4 - 5 times cost

Beer................................................. 2 1/2 - 3 times cost

Wine by the glass ............................... 3 - 4 times cost

Carafe wine.................................... 2 l/23 times cost

Dessert wines.................................. 2 - 2l/2 times cost

  • Three main pricing methods. There are, however, three general approaches to markups in the beverage industry. A basic understanding of these options will guide you in the right direction:
    1. Traditional markup - a combination of intuition and local competition. Don't rely on intuition alone - you'd be on to a loser.
    2. Cost plus markup - here, price is determined by adding a markup to the  cost of the item. Easy to apply, this method is popular in the beverage industry.
    3. Item cost percentage markup - similar to cost plus pricing, but linked to profit targets.
  • Type of establishment. Markup is often driven by the type of establishment. For example, luxury hotels, restaurants and nightclubs can command heftier markups. Bars and taverns, on the other hand, have to compete more fiercely with similar outlets in the locality.

This article is an excerpt from the Food Service Professional Guide to Controlling Liquor Wine & Beverage Costs, authored by Elizabeth Godsmark, published by Atlantic Publishing Company. This excerpt has been reprinted with permission of the publisher. To purchase this book go to:

Atlantic Publishing Company
Amazon.com

Topics: bar profitability, NightClub Management, bar business, Bar Management, opening a bar, Increasing Profits, pricing drinks

Insider Theft Can Have a Major Effect on Bar Profits

Posted by Nick Kaoukis on Tue, Sep, 27, 2011 @ 15:09 PM
By Elizabeth Godsmark
Atlantic Publishing
 

bartender theftThis is an alarming fact: most types of beverage operations lose a crippling percentage of profits through insider theft. The vast majority of employees in the beverage industry are honest and hardworking; it is the small minority of staff that can ruin your business through dishonesty. Insider theft can often escalate if there are weaknesses in the following general areas of the operation:

  • Lack of supervision. Theft from behind the bar, storeroom or storage areas is a major problem. Curb losses by increasing supervision, either in person or by means of strategically positioned security cameras.
  • Proprietor attitude. Don't make matters worse by treating all employees with suspicion. Get the honest staff on your side.
  • Weak management. Unfortunately, some beverage managers compound the issue of insider theft by turning a "blind eye" and simply increasing prices to cover "shrinkage." Owners need to question unwarranted price rises.
  • Pouring costs A common danger area. These costs need to be carefully monitored, especially in relation to bartender productivity.
  • Inventory records. This is one of the easiest areas for dishonest employees to "fiddle the books." Tighten up your record keeping. Never leave inventory control to one person. Double-check.
  • End-of-shift cash count. Another prime target area for insider theft. Never let a bartender reconcile the cash in the register at the end of his or her shift.

 

Bartender Theft: Top Ten Ploys

Controlling theft behind the majority of bars is no mean task; eliminating it altogether is virtually impossible. Temptation is a fine thing, and unfortunate­ly, the opportunity for bartender theft is overwhelming. However, in the interests of long-term survival, you have no choice but to tackle the problem head on. Be wary of the following top-ten common ploys:

  • Open theft. A bartender pours a drink, doesn't ring the cash register and puts the cash in a "holding" place, such as the tip jar.
  • Overcharging. Bartender pockets the difference. A variation is to charge regular prices but ring up "Happy Hour" prices and, again, pocket the difference.
  • Ringing "00" on the cash register. The bartender simply steals the value of the drink.
  • Overpouring. Bartender hopes to get a heavy tip.
  • Underpouring. Bartender keeps a mental note of the number of half measures poured throughout the evening and then thieves the equivalent value in drinks, gives them away or drinks them him-or herself.
  • Rounds of drinks. Bartender rings up for a "round" rather than separate items. It makes it easier to inflate the overall price of a round of drinks, particularly if guests are unfamiliar with individual prices.
  • Shortchanging. Common variations include: counting aloud while handing the customer less money, distracting the customer by sliding the change along the bar, and giving change for lower -denomination bills (while keeping the difference).
  • "Soft" inventory. Bartender neglects to charge for the mixer component of a drink.
  • Substitution - bringing in own liquor. This is often done with vodka because it is odorless and looks like water. Dilution is another similar ploy.
  • Padding the tab. The bartender pencils in an inflated total and later erases it, replacing it with the correct total. Warning! Ban pencils from behind the bar.

 

Less Common (But Equally Damaging) Employee Theft

The more experienced the dishonest employee, the better equipped he or she is to manipulate the system. Thieving members of staff are quick to detect exactly how much an owner really understands about the business. In the beverage industry, take nothing for granted. Alert yourself to the following, somewhat extreme, possibilities.

  • Reusing closed tabs. The bartender appears to ring up the drink price but, in actual fact, only halfway enters the tab into the register. He or she then hits "0" to give the impression of ringing it in.
  • Over-ringing. When the customer isn't looking, the thief over-rings an amount on the tab and then re-rings the tab for less than the amount charged.
  • "Paid outs." The bartender claims that the money was refunded for various reasons, such as faulty cigarette machines.
  • Jigger substitution. The bartender brings in his own shot glass that looks identical to the official jigger but is actually smaller. Several short measures over a shift add up
  • Changing shifts. It is easy for the thief to make, serve and collect several drinks during a busy "hand-over" period.
  • Deliberate mistakes. Drinks are then returned and resold or given to a friend.
  • Breaking empty bottles and pretending they were full. Full bottles are then requisitioned to replace the "broken" empty bottles.
  • Substituting water in the drip tray. The bartender pretends he or she had to waste a pint to clear the lines and then pockets the difference.

     

    This article is an excerpt from the Food Service Professional Guide to Controlling Liquor Wine & Beverage Costs, authored by Elizabeth Godsmark, published by Atlantic Publishing Company. This excerpt has been reprinted with permission of the publisher. To purchase this book go to:

    Atlantic Publishing Company
    Amazon.com

Topics: bar inventory levels, bar business, Bar Management, Reducing Costs, bar control, Control

Drink Selection: Optimizing Your Liquor Inventory

Posted by Nick Kaoukis on Mon, Sep, 19, 2011 @ 10:09 AM
By Elizabeth Godsmark
Atlantic PublishingLiquor costs
 

Part 4 of 4: Trim Liquor Costs

Liquor prices don't vary a great deal from one wholesaler to another. Packaging and size also tend to be fairly consistent. So, what can you do about reducing liquor costs in your operation? The answer is quite a lot! It's a misconception in the liquor trade that your options are limited when it comes to selling liquor. Consider the following opportunities:

  • Bulk buys. Purchase staple liquors, such as whiskey, gin, vodka, brandy, rum and other popular spirits (e.g., fruit brandies) in bulk. They have a long shelf life and you know you can sell them within a reasonable period of time.
  • Trends. Stay ahead of consumption trends. Respond quickly. For example, the current trend in the United States is toward "light" spirits such as 80-and 86-proof whiskies, instead of 100-proof (50 percent alcohol) bonded whiskies. Wholesalers, too, are keen to promote these alternatives.
  • Distilled spirits. Their shelf life is exceptionally long. Buy distilled whenever possible, and minimize wastage.
  • Well liquors. Which well liquors you choose can really make a difference in reducing costs. But don't buy at any price and compromise on quality.Your reputation is at stake. Customers often judge an establishment by the quality of its well liquor.
  • Call liquors. Increase margins on call liquors (brand names). Guests who ask for Gordon's gin or Jack Daniel's whiskey, for example, are loyal to the brand and will probably not question the price.

 

This article is an excerpt from the Food Service Professional Guide to Controlling Liquor Wine & Beverage Costs, authored by Elizabeth Godsmark, published by Atlantic Publishing Company. This excerpt has been reprinted with permission of the publisher. To purchase this book go to:

Atlantic Publishing Company
Amazon.com

Topics: Hotel Inventory, Liquor Inventory savings, alcohol cost

Drink Selection: Optimizing Your Liquor Inventory

Posted by Nick Kaoukis on Wed, Sep, 14, 2011 @ 10:09 AM
By Elizabeth Godsmark
Atlantic Publishing
 

Part 3 of 4: Cocktails--Reduce Costs While Cocktails, LiquorIncreasing Customer Satisfaction

Cocktails are good for profits, and cocktail hour can be serious, big business. The customer feel-good factor is crucial. This can be achieved at no extra cost. Imagination is free.

  • Well brands. Reduce costs by sticking to well brands for cocktails. Don't pour away your profits by using premium brands in cocktail recipes.
  • Premium brands. Your establishment might be the sort of outlet that can make big profits out of selling premium brands. If so, use premium or middle-grade ingredients in your cocktails. Take every opportunity to advertise that fact. Emblazon quality brand names across your menus. Also, speak to your suppliers - they may be interested in offering you reduced rates in exchange for some free advertising.
  • Signature drinks. Use your imagination and create something really special. Above all, a signature drink must look special. Choose unusual colors. Use different garnishes, such as asparagus, pepperoncini, jumbo shrimp, crab claw or scallions. Stand out from the crowd.
  • "Stirred, not shaken." Don't shake mixed drinks that contain carbonated ingredients, particularly if those components are clear liquids. The bubbles will go flat, and the liquids will become cloudy. Stir instead.
  • Presentation. Dare to be different. How about serving Chambord on the side for a Meltdown Raspberry Margarita? Let customers pour the liqueur portion themselves. As the liqueur blends into the drink, it will release wonderful aromatic raspberry flavors. It will also look visually stunning. Guests will think, "value."
  • Champagne. Many recipes use champagne as a base ingredient. Once opened, a bottle of champagne or sparkling wine becomes a liability, because the bubbles are short-lived. Buy a bottle sealer specifically designed to cope with this problem. Ensure that bartenders know how to use it. You can't afford champagne wastage.
  • Ice. Choose a cocktail station that has a deeper-than-average ice bin (up to 15 inches, maximum capacity). Put a divider through the middle of the bin and use it for storing both crushed and cubed ice. When the bar is busy, hanging around waiting for ice supplies costs money.
  • Speed. Reposition liquor, wine and soda guns directly above the cocktail station. The soda gun should be placed on the left-hand side of the station, so that the bartender's right hand is free to hold a liquor bottle at the same time. A bartender using both hands is working at top speed and maximum efficiency.
  • Perceived value. Improve customer perception of value and quality by increasing the high-cost portion of the cocktail. Up the liquor content to two ounces. Guests will feel they are getting real value for their money; you know this is good for profits.

 

This article is an excerpt from the Food Service Professional Guide to Controlling Liquor Wine & Beverage Costs, authored by Elizabeth Godsmark, published by Atlantic Publishing Company. This excerpt has been reprinted with permission of the publisher. To purchase this book go to:

Atlantic Publishing Company
Amazon.com

Topics: liquor inventory timing, restaurant trends, liquor products

Drink Selection: Optimizing Your Liquor Inventory

Posted by Nick Kaoukis on Mon, Sep, 12, 2011 @ 10:09 AM
By Elizabeth Godsmark
Atlantic Publishing
 

Part 2 of 4: Make the Right Choice of Wines

wine inventory

Choice of wine is a very individual matter. There are no rights and wrongs. It is important, however, to pander to customer preferences. Whether you run a bar, restaurant, club or specialized wine bar, you must purchase wine according to the demands of your clientele. If you get it right, profits will soar. But, if you choose wines that aren't a hit with your customers, you end up pouring your profits, as well as the unsold wine, down the drain.

  • Competition. Look at the competition. Keep up to date with which wines are moving well. Read trade journals and publications, such as the "California Wine Growers Institute," to learn more about current trends, or consult the California Association of Wine Grape Growers: 555 University Avenue, Suite 250, Sacramento, CA 95825; www.cawg.org.

  • Regularly review the wine list. Be ruthless - if a wine is slow-moving, remove it from the list.

  • Get ahead of the crowd. Introduce wines from up-and-coming wine regions. Suggestions include: New Zealand Riesling, Gewurztraminer and Sauvignon Blanc for whites, and South African Pinot Noir or Merlot for reds.

  • Storage. Wine is a vulnerable product. One of the most effective ways of reducing costs and avoiding waste is to store wine in the correct environment (temperature, light and ventilation are particularly important). See www.storing-wine.com for handy tips on storing wine.

  • Opened bottles. Establish par levels for each wine stocked behind the bar. Only open as many bottles as you need for one shift. All wines, particularly whites and cheaper house reds, become oxidized and deteriorate quickly once opened. A useful tip is not to pull the cork completely out of the bottle. If a cork is only partly pulled, the wine remains sealed, preventing oxygen from entering the bottle.

  • Cost controls on empty bottles. Count empty wine bottles at the end of each shift. This practice makes sure that bartenders aren't overpouring. For example: you use six 1.5 liter bottles of wine during a shift; your standard portion for wine is 5 ounces; then sales for 60 to 61 glasses should show up on the register tape.

  • Discount premium wines. Discounting premium wines results in a higher potential for profits. It also gives bartenders the opportunity to up-sell customers from standard house wines. This plan works well with "special buys" and wholesaler promotions.

 

This article is an excerpt from the Food Service Professional Guide to Controlling Liquor Wine & Beverage Costs, authored by Elizabeth Godsmark, published by Atlantic Publishing Company. This excerpt has been reprinted with permission of the publisher. To purchase this book go to:

Atlantic Publishing Company
Amazon.com

Topics: wine inventory, red wine, wine list, white wine