Expert Advice on Hospitality Topics

A Successful Bar Begins With a Quality Staff

Posted by Nick Kaoukis on Thu, May, 26, 2011 @ 09:05 AM
By Chris Parry
Atlantic Publishing

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Part 1: Hiring the Best Possible Staff

Finding the Right People

A successful bar operation depends on people more than anything--the people coming into your bar and the people behind it. How you treat your staff, how you find them, how you train them and how they work are keys factor in hospitality success. Many bar managers find that one of the most difficult tasks in their job is finding the right people to join their staff. If you want the best possible employees (and you shouldn't want anything less), these rules might assist you in your search:

  • Headhunt. If you want simply to fill a handful of roster slots with physically able bodies, classified ads may be a fine option. Classified ads will certainly bring you applicants. However, the best hospitality people are generally not unemployed; they're already working for your competition. Take a look around the better local establish­ments. If you see someone worth headhunting, make him or her an offer.
  • Ask your existing staff. They can be a great source of new staff; they usually know plenty of industry colleagues that would be a nice fit in your bar, and though you don't want to form "cliques," a personal reference from someone you respect sure as heck beats a cattle call.
  • Offer a finder's fee.  If someone working for you brings in a new employee that stays with you past a probationary period, a $75 bonus will get your existing people thinking hard about staffing possibilities.
  • Keep applications on file! If someone walks in the door and asks for a job when none has been advertised, you can bet they already know and like your establishment and truly want to work there. Motivated souls such as these make prime pickings, so don't disregard their applications - keep them and get in touch when you need to.
  • Time is money. Don't waste too much of it by interviewing everyone who applies to you. If an applicant isn't to your initial liking, thank him or her for the application and move on to someone who is.
  • The need to earn. It's traditionally thought that the more stabilizing factors there are in a person's life, such as being a student, having a mortgage or being married with children, the less likely that person will be to leave suddenly or jeopardize his or her job through tardiness.
  • What are you looking for exactly? Different roles require different skills. While not every position requires abundant experience, every position does require a mix of stability, intelli­gence, personality, honesty and a willingness to work. If an inexperienced applicant shows these qualities, look past any lack of skills and make an investment in a quality human being with training.
  • Every employee is a reflection of your corporate personality. It's important that employees view every customer as a potential friend, not an irritation. Certain people can light up a room with a smile, and if you can find two or three of those people, your customers will be back.
  • Never interview an applicant who has just made his or her application. Let him or her show enthusiasm when you call about an interview at a later date. If the applicant can't make it or doesn't show up, you're better off without.
  • Ask the right questions. If you want to be sure you have all the information you require from each person, put together a list of questions in advance. This will allow you to get comfortable, focus on the answers and stay on target.
  • Don't be afraid to ask for a demonstration. If a prospective bartender has trouble uncorking a bottle of wine or mixing a good martini, it's better that you find out ahead of time.

How Do You Test for Honesty

Dishonest employees are not always going to make themselves obvious. Sometimes the person with the biggest smile has something even bigger to hide. When hiring your staff, how can you go about discovering who is to be trusted and who should be shown the doors?

  • Background check. This might seem a draconian tactic to determine if your potential employees are who they say they are. You can run a check on your prospective staff online through an outfit like US Search (www.ussearch.com), who will take the person's details and run a check on credentials for only $59.95 - $99.95 for a criminal background check. The results of these searches can, in most cases, be e-mailed to you within 24 hours, with full details taking up to seven days.
  • References. Thorough checking of all references is a must, especially for a person interviewing for a position of trust. Call every company listed on the employee's resume and be sure to ask the correct questions: Why did the person leave? How long was she there? What position did he hold? Would the company gladly take him back if given the opportunity?
  • Credit check. If prospective employees will be in a position where they're exposed to a large amount of money, it may be prudent to run a credit check before you employ them.
  • Sometimes the simplest approach is the best. Why not just ask potential employees if they've ever taken something that wasn't theirs? Watch their body language when you ask the question. Do they blush? Do they avert their eyes? Do they fidget? Do they nod their head, as they say "no"?

 

 

 

 

This article is an excerpt from the Food Service Professional Guide to Bar & Beverage Operation, authored by Chris Parry, 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 staff, bar business, Bar Management, bar control

Drinking On The Job: Dont Do It!!!

Posted by Nick Kaoukis on Mon, May, 16, 2011 @ 10:05 AM

BAR MANAGEMENT
by Bob JohnsonDrinking at your bar

PART 1

If you are an owner or general manager who allows your staff to consume beverage alcohol during the scope of their employment—i.e., “drinking on the job”—you ought to be taken outside and shot!  Okay, that may be an exaggeration.  But when you carefully examine this issue, allowing your staff to drink on the job is the ultimate act of stupidity,

irresponsibility, and disrespect for the welfare of your employees and your business.  Owners and managers must protect their business from potential lawsuits, and allowing your employees to drink while they work leaves you wide open.  You’re taking the chance of losing it all.  So why would anyone put themselves in this position?              

It may be common practice in many bars, nightclubs and adult nightclubs for bartenders, managers and entertainers to drink alcoholic beverages while on the job.  But as bar management expert Bob Johnson suggests, it could be the worst mistake these people could make — and could put you out of business up there with …duh-h-h-h-h-h.  Does the fate of your business really come down to how much the employees can slug away for you?

Ethyl alcohol affects judgment and impairs one’s ability to rationalize or perform a function that requires effective interpretation or quick reaction.  “Misreading” a situation is commonplace for anyone consuming beverage alcohol, regardless of the amount consumed.  Counting money, making a judgment call, responding to a pressure situation or settling a disturbance can only be done with a clear mind.  Beverage alcohol is not a “performance enhancer”!

Legally, if there are damages or injury to a third party and you were involved in the situation in any way—and it was known that you were under the influence of alcohol at the time—your company and you have no reasonable defense.  You just lost the case! You probably don’t have enough money to defend yourself in this kind of situation.

Medically, if there is injury to you while on the clock and you have consumed beverage alcohol in any quantity, worker ’s compensation will not pay for your medical treatment.  You’re on your own. Because you work in a heavily scrutinized industry, management and staff must never be under the influence of beverage alcohol when confronted by a representative of local law enforcement or a governmental agency performing a routine assignment that wants to ask questions.

Topics: Bar staff, NightClub Management, Bar Management

Human Resources and Owning your Bar

Posted by Nick Kaoukis on Thu, Apr, 14, 2011 @ 13:04 PM

ARE YOU REALLY READY TO OWN AND OPERATETO OWN AND OPERATE A BAR

 

Part 3:Bar working

HUMAN RESOURCES

Human resources is the single most important function in the bar business, yet remains the overlooked, misunderstood, and taken for granted. If the bar manager is responsible for the hiring of staff, then he must have the ability to hire the right kind of people. He must know where to get them, what to look for on an application, and what questions to ask during the interview.  It is necessary to describe what the specific job requires. For example: Bartenders must have the ability to give attention and recognition (the primary reason a customer returns to a particular bar—it’s not the drink!); they must be willing to take direction (the more experienced the bartender, for example, the harder it is to break them of their habits of doing things “their way”); and most importantly they must have a personality! They have to look alive, happy, and think of themselves as “show people,” constantly entertaining.

They must be honest and never succumb to the temptation of drinking while they work. A bar manager who drinks while on shift, or allows his bartenders to imbibe with customers, is not professional and doesn’t know what he’s doing (potential for law suits, uncontrolled environment, no workers comp protection if injured on the job, etc.). He is inviting problems. No job I know of allows workers to drink beverage alcohol while working.

The ultimate success or failure of your bar will be determined by those you hire. How well they do their job with cash and product, the frame of mind they are in when doing their job, and how they directly interact and impress each customer they serve directly affects your bar’s sales, profitability, and the length of time you will stay on as the bar manager.

Do you have a bartender’s manual, cocktail server’s manual, bar back manual, orientation manual, training manuals for all positions, etc., that describes exactly how you want everything done? Do you have the writing skills to create these manuals if need be? Have you documented your house rules about eating, smoking, free drinks, break privileges, payday, schedule posting, dating, using the company telephone, cell phone policy, personal belongings, accidents on the job, switching shifts, cashing checks, when to be at work, serving minors, serving visibly intoxicated people, gambling, holidays, illegal drugs on the property, “to-go” drinks, being on the property when off duty, etc.? You must paint a picture for everyone to follow so that your policies are consistent and there is no misinterpretation. Every rule you could possibly make has to be documented, so you can say, “It’s in the book!”

How do you train your new hires and how do you continue training and motivating the entire staff? A bar manager should be constantly testing the entire bar staff for compliance with house recipes, glassware, garnishes and knowledge about new products and promotions.Do you evaluate your employees’ performance on 180 day intervals? Do you document an employee’s disciplinary problems and retain a copy for the personnel file with a timeframe for improvement? There are so many lawsuits these days over seemingly insignificant problems that it behooves a bar manager to do everything within his power to support his and his company’s position in court. You must have the documentation to do so. Do not become lackadaisical when terminating an employee. You must use a termination form and fill it out

Handling a termination correctly requires knowledge and experience. Many states are “employee at will,” meaning you don’t have to have a reason to fire someone. But this is being challenged nationwide, and you don’t want to be the test case for your state. Therefore—document, document, document! And always have a witness present when you are terminating someone.

You should know whether or not your employees should be allowed access to their personnel file and what they can and cannot see in their file. Do you ask medical questions about your employees? When? During the interview? (No, that’s against the law.) What about the I-9? Are there more forms that can be used to determine identity and eligibility to work besides a driver’s license and social security card? No? Are you sure? Check columns A, B, and C on the back of that form.

What information should you have in the employee’s personnel file to successfully fight an unjustified claim for unemployment compensation? In the event of an injury, do you fill out an injury report for workers’ compensation and send it to your insurance carrier within seven days? 

Do you understand the laws pertaining to the Bureau of Alcohol in your state? Do you understand why it is illegal to “marry” liquor, or why you can’t refill an empty liquor bottle with any other substance? What about the OSHA (Occupational Safety and Health Act)? What does it state? And ADA (Americans with Disabilities Act), and USERRA (Uniformed Services Employment and Reemployment Rights Act)? Do you know the laws pertaining to reporting tips, sexual harassment, the Equal Pay Act, the Tip Credit Law, and Overtime Pay Rate for Tipped Employees?

“You have to know all of the laws that pertain to the business you own and are managing. Otherwise, it can be very costly and it could land you in big legal trouble.”If you are in a state that takes a tip credit (paying less than minimum wage), have you informed your employee at the time of hire why you are taking the tip credit and what their rights are as a result? You’re breaking the law if you don’t. If you are paying less than minimum wage (taking the tip credit), do you ever penalize your employees financially for a missing check, a walk-out, being $20 short in the register, the cost of a uniform, etc.? (Nope—it’s against the law!) Can you deduct anything for meals, or the service charge for a tipped charge? Check with your state, as it varies nationally.

You get my point—there is so much to know and be aware of. As a manager, one of the most important rules is: Don’t do anything that gets your owner/business sued. So you must

WHICHEVER YOU CHOOSE TO USE, HAVING STAFF FOLLOW GUIDELINES FROM A BARTENDER’S MANUAL WILL HELP MAKE SERVICE UNIFORM.

Know the laws that pertain to the business you are managing. Otherwise, it could be very costly and land you in big trouble.Now that we have scratched the surface of human resources in the bar business and put forth some questions for you to look into, you should have a better understanding of how much there is to know—and we’ve just begun!

Topics: bartending schools, bar business, Bar Management

Running a Bar Vs Managing a Bar

Posted by Nick Kaoukis on Wed, Apr, 13, 2011 @ 12:04 PM
e-mail: "bjbarhop@aol.com, web page  
www.BobTheBarGuy.com 
 
ARE YOU REALLY READY TO OWN AND OPERATETO OWN AND OPERATE A BAR

Part 2:bartender

“The ultimate success or failure of your bar will be determined by those you hire. You must paint a picture for staff to follow so that your policies are consistent and there is no misinterpretation.”

As a bartender, you learned and practiced proficiency in bar terminology, product knowledge, mixology, tools of the trade, bar equipment, dealing with the public, cash controls, cleaning, stocking, bar organization, and the laws related to the responsible service of beverage alcohol. To be a bar manager you must continue your learning process far beyond that of a bartender, and here is where we run into a problem— learning the additional, necessary skills needed to effectively manage a bar.

A bar manager must have the knowledge and ability to directly oversee all bar operations and personnel, which includes the processes of hiring, training, evaluating, disciplining, terminating, and scheduling (human resources), and ordering, receiving, inventory controls, product cost purchasing (beverage control). Additionally, he should have the ability to properly price drinks, execute promotions, and pull a shift or two behind the bar to help out on labor costs as well as stay current with drink trends, maintain efficiency, and stay in closer touch with the staff and customers. I believe a good bar manager should work at least two shifts behind the bar every week (and never the same two days).

Topics: bartending schools, Bar trends, Bar Management, bar location

ARE YOU REALLY READY TO OWN AND OPERATETO OWN AND OPERATE A BAR

Posted by Nick Kaoukis on Mon, Apr, 11, 2011 @ 14:04 PM

put grand opening bar 800X800

e-mail: "bjbarhop@aol.com, web page  
www.BobTheBarGuy.com

“There Is a World of Difference Between ‘Running’ a Bar and ‘Managing’ a Bar.”

Part 1:

Many people get into the bar business thinking they are going to be great owners/ managers and will naturally be good at this line of work.

Unfortunately, in many cases, their egos will prevent this from happening. If only these people would just set their egos aside
and say, “I’m obviously a very talented individual. I could become good at owning or managing a bar, but I have to be willing to learn. I have to be willing to open my mind to the possibility that I’m wrong and to listen to other people—especially the qualified professionals.” To paraphrase from an article written by professional poker player Annie Duke, in USA Today: Commenting on why CEO’s make lousy poker players, she says, “Their egos get in the way.”

Well, most owners/managers of bars make lousy operators (and poker players) for the same reason. This is a tough realization for someone to accept, particularly someone who has risen to the top in another profession. “Don’t tell me what to do! After all, I’ve been in business for 27 years!” or, “Running a bar is not rocket science—anyone can do it!” or, “Hey, I own this joint! Who are you?!”

Well, I’m here to tell you that there is a world of difference between “running a bar” and “managing a bar.” Anyone can own or run a bar, but very few can correctly operate and manage one. Don’t kid yourself—you don’t just walk in, take over, and start
telling staff what to do. You have to know what you’re talking about. Just because you may have been successful in another business does not mean you will be successful in the bar business.

If you think owning or managing a bar is easy, continue reading. Bar management skills are learned, not inherited. I think you’ll eventually come to the profound realization that you really have to know what you’re doing. Making too many mistakes because you don’t know what you’re doing could possibly put you in jail, out of a job, and out of a lot of money.

Before anyone decides to buy a bar or take a step up to management, I suggest you put your ego aside and read the following pages about what it takes to be successful in the bar business. Trust me—this is a difficult business, and it’s not for everyone. 

MANAGEMENT
Bar manager is a skill position that requires years of careful
observation, studying, experience, and know-how; yet, its importance has long been underestimated by owners in the hospitality industry. Even hospitality management schools place little importance on the subject of bar management, often making it an elective rather than a requirement for students graduating with what is considered food and beverage proficiency. Their definition of proficiency typically centers on knowledge of wine—which is nice, but has little to do with a nightclub or bar.
    

Before a head bartender or an entry-level manager accepts the job of bar manager, they should have a complete understanding of what the job entails. And, yes, bar managers should be former
bartenders. An in-depth knowledge of professional bartending is the starting point from which one learns bar management. It’s hard to be a truly effective bar manager unless you have a complete understanding of how to tend bar. “The gift of gab,
the casualness, and the caring, friendly service a bar manager gives to his customers comes from a bartending background,” says Bob Schwenker, former General Manager of Hooligan’s Pub in Miami, Florida. “A good bar manager has the ability to
make people feel comfortable. You shouldn’t make
the progression to bar manager without being a
bartender first.”

Topics: bar business, Bar Management, hospitality jobs

How to Run a Bar?

Posted by Nick Kaoukis on Fri, Mar, 25, 2011 @ 11:03 AM
e-mail: "bjbarhop@aol.com, web page  Bar Management
www.BobTheBarGuy.com
phone number: (800) 447-4384

Every bar is different. Popular liquors are pretty much the same from bar to bar, but how it gets to the customer—the pour, the glassware, the way it’s made and garnished, and how it’s priced—can vary. So we put the same pour spouts on all the bottles and encouraged the owners to “control the pour.” No more count system (they had four different types of spouts on the liquor bottles, each one wider or faster than the other). They agreed to a controlled pour, went with a 1¼ oz. metal jigger across the board, and made it a requirement that all bartenders measure each shot of liquor. This technique will lower their portion controlrelated losses by 3 to 5%.

A “doghouse” concept was created and implemented (back-up bottles and storage area for each brand of liquor at the bar). They no longer had the operational crisis of running out of liquor at the bar on a busy night. It would never happen again.

Next, we addressed glassware. The highball glass they were using was ten ounces, their shots 1¼ ounces. This was causing the bartenders to over pour each shot in order for the drink to taste right using the correct amount of mix to liquor. This adds up over time.

I explained to the owners the importance of enforcing a drink recipe manual for their bartenders. No bartender should be allowed to make drinks their way. The house gives the bartenders the recipes for all drinks, how they’re to be made, and how they are priced. Bartenders should be routinely tested on the house drink recipes.

We then created inventory control forms for all parts of the liquor inventory. This included a Liquor Requisition form (accounting for the empty bottles at night’s end); Storeroom Perpetual form (accounting for the daily movement of liquor into and out of the storeroom);

We then created inventory control forms for all parts of the liquor inventory. This included a Liquor Requisition form (accounting for the empty bottles at night’s end); Storeroom Perpetual form (accounting for the daily movement of liquor into and out of the storeroom);

Ending Inventory Count form (the physical counting of the liquor at week’s/month’s end); Usage/Cost form (gives you an Operational Pouring Cost percentage and an Actual Pouring Cost percentage number at the end of the reporting period); and an Order form (for all liquor products by vendor). Utilizing these forms creates day-to-day accountability for the liquor inventory and a way to hold the bartenders accountable for what they do.

Of course, the draft beer program was out of control. They were using frozen mugs and pitchers, and they were wasting at least half a keg per brand because of the constant foam problem. We stopped that by simply lowering the temperature in their walk-in cooler to 36 degrees (from 42 degrees) and going to refrigerated glasses instead of frozen. I told them to call their beer distributor and have them install separate pressure regulators for each brand of beer so the internal keg pressure in each brand of draft will equal the amount of pressure coming from the CO2 canister, thereby reducing the amount of foam. Bartenders were taught to open the tap handle from the base of the tap handle, not the top, thereby reducing the pressure that creates foam on the pour.

In doing all this, the number of kegs they had to order each week was cut in half (half!). The beer companies won’t like it, but too bad. I asked them if a beer company ever volunteered to help them out with their foam problem. Of course not! Their taco bar sells a lot of draft beer, and these changes saved big bucks. [Ed. note: See page 34 for more information on draft beer management. 

The owners of this bar/restaurant were very experienced with food service, but had never worked in a bar before. They had no bar skills, yet found themselves in a position of having to make serious, daily operational calls. They hired a bartender/bar manager with 12 years of experience, but his knowledge was still limited. He said he knew a lot about the business, but my conversations with him put him in the same category as so many supposed bar managers—they’re nice people, they mean well, but they don’t know a lot! And it’s not their fault. There are no schools, to my knowledge, that teach “How to run a bar.” You learn by the seat of your pants (and by reading Bar Business Magazine). You bring something with you from the last place you worked that you think will help the new place. Usually, it’s bad habits and bad theory. Not good for the old place, not so good for the new place, either!

I could go on about the improvements we made for this client, like the changes in controlling every bottle of beer, wine, champagne, and energy drink, correcting the tip reporting, and numerous other human resource discrepancies, but I think you get the point. There is so much a qualified bar consultant can do to help you realize the profit potential of your business.

My session with these nice people lasted about five hours. In that time I estimate I put in their pocket—if they follow through with all the changes I suggested—at least an additional $90,000-$120,000 in profit per annum, and probably more.

As such, I recently had a conversation with another bar owner in Augusta, Georgia, who said to me, “We should have hired you before we opened. I know you would have saved us at least $200,000.”

So why didn’t he? 

Topics: bartending schools, NightClub Management, Bar Management

How to Best Utilize Bar Consultants

Posted by Nick Kaoukis on Wed, Mar, 23, 2011 @ 15:03 PM
Bar Consultinge-mail: "bjbarhop@aol.com, web page  
www.BobTheBarGuy.com
phone number: (800) 447-4384 

     Why hire a bar consultant? I get asked this question a lot. So I felt the best way to answer is by sharing what I experienced  on my last consulting job,  which took place at a Mexican restaurant/bar outside Los Angeles that was owned by a young couple who knew a lot about the restaurant business, but didn’t have a clue about the bar. They did, however, know that the majority of their profits should be coming from the bar. It wasn’t. 

     By explaining some of my consulting procedures and techniques, you might get a better understanding of how much difference a qualified bar consultant can make in having a better-run, more profitable bar. We’re talking money here—bottom line results putting more money in the owner’s pocket. Isn’t that why you got into this business, to make as much money as possible? Everything I do as a bar consultant translates into making more money for the owner.

     The first thing I tell anyone using my consulting service is, “don’t take anything personally.” It’s easy to offend egos amongst so much correction and professional critique. Many people have a true passion for their rather hefty investment, and sometimes they take not knowing how to run it very personally. But it’s just business.

    Once on site at the Mexican bar/restaurant, I looked at the drink stations and the general arrangement of everything behind the bar. There was no standardized order or arrangement of liquor bottles at the two drink making stations. Nothing was labeled. The high-usage items were not at the bartenders’ fingertips. Motion was reduced and drinks could not be made quickly. The drink stations did not “mirror” each other. Bartenders had to cross behind or reach over each other to get certain liquors. The soda guns were in the middle of the ice bin instead of on the far left side, so the hose of the soda gun was in the way of icing glasses, making it difficult to make drinks. I suggested putting a call in to the manufacturer to get the guns reinstalled in the right place.

    The lack of prioritized organization here reminded me of how important it is to do an analysis of liquor usage—what sells and what doesn’t. So we analyzed POS sales reports. From that analysis we culled a “dead stock” inventory of liquor product that wasn’t selling and we placed it away from the bar and storeroom, far from the active liquor inventory.

    With the remaining product—the “active liquor”—we created a bottle arrangement system for both drink making stations and the back bar that made it easy to know where everything was located, then labeled every bottle location.easy to pinpoint two reasons bars go under: Lack of manage is usually created by the lack of management skills, but a Next I looked at how they were pricing their liquor “by the shot,” and discovered they were missing out on an additional 20 to 25% in gross profit because they didn’t understand how to price properly. They only had three categories—well, call, and premium. I changed that to five categories: well, call, premium, super-premium and top shelf. I estimated that correctly pricing the liquor would add an additional $30,000 to $40,000 gross profit to their business by year’s end, at their present rate of sales.

    I also recommended discontinuing the use of quarters behind the bar, making all drink prices even-dollar amounts. I changed the way they charged tax on each drink; we made all drink prices inclusive with tax—in other words, $4.50 for the drink, not $4.25 for the drink plus $.28 tax. 

    I noticed the venue’s POS register system needed upgrading to better reflect actual sales. It was recording “doubles” but wasn’t identifying what liquor was being poured as a double. We called a technician and had drink prices reentered according to the new five-tier categories. Most of the recipe drinks were also incorrectly priced and were subsequently changed as well.

Topics: NightClub Management, Bar Management, Nightclub Consulting

Better Inventory Management Equals a Better Bottom Line

Posted by Nick Kaoukis on Mon, Feb, 28, 2011 @ 09:02 AM
By Elizabeth Godsmark
Atlantic Publishing

Part 3 of 6: Good Liquor Inventory Management Improves Cash Flow and Maximizes ProfitsCash Flow

Inventory Levels Affect Cash Flow

The aim is to maintain that fine balance between J. running out and holding too much stock. Get it wrong, and you'll find that your working capital isn't working for you! Remember, the larger your inventory, the more difficult it is to control.

  • Keep inventory at a minimum level. But not so low that you risk running out. Recommended inventory for high-turnover brands is approximate­ly one to two weeks' worth of stock.
  • Jump in with special promotions. If you think you've miscalculated and overstocked, shift the inventory sooner rather than later, while it still has high value.
  • Get to know the drinking patterns of your regular patrons. This information helps you calculate the bar pars or minimum inventory levels for each bar and the main stockroom.
  • The perpetual inventory is a valuable tool. Keeping tabs on the flow of liquor, wines and beverages through your operation is probably the best way of knowing where to pitch inventory levels. Monitor stock daily.
  • Weekly deliveries. In the drinks industry, this is the norm. Work your inventory levels around these weekly deliveries and avoid the cardinal sin of running out.

Manage Your Stock Wisely and Maximize Profits

Your challenge, in a nutshell, is to order liquor, wine and other beverages in the right size and quantity and at the right time and price.

  • Inventory deliveries - timing. Schedule well liquor, beer and house wine deliveries for the same day each week, ideally a couple days after you place the order.
  • Well liquor quantities. Order items with a short turnover rate, such as well liquor, in bulk. Well liquor moves fast, offering you a great opportunity to boost cash flow. Take advantage of case discounts. Also, consider larger 1.75-liter bottles instead of the usual 1-liter bottles if you think your turnover warrants it. There are big savings to be made in this area. Use larger bottles for special promotions.
  • Beer is different. In order to sell beer at its freshest, arrange for deliveries on a weekly basis, or dally, if your establishment has the capacity to cope with the extra workload. Little and often is better when it comes to maximizing on beer profits.
  • Wine. Order house wine weekly, other wine bottles by the case once a month. Only buy special vintage wines once or twice a year. Take a specialist's advice before stocking up on expensive wines. They can cost you dearly.
  • Liquor and liqueurs. The following is a useful guideline: If it takes less than five weeks to turn a product, order by the case. If it takes longer than five weeks to sell a particular brand of spirits, order by the liter.


Topics: Bar inventory, bar inventory levels, Bar Management

Establishing Effective Purchasing & Receiving Strategies

Posted by Nick Kaoukis on Mon, Feb, 14, 2011 @ 10:02 AM
By Elizabeth Godsmark
Atlantic Publishing

Part 7 of 7: Reduce Purchase Costs

reduce purchase costsThe purchasing department is the linchpin when it comes to reducing costs. It is much easier to control costs in this area than anywhere else in the operation. The bottom line is that astute buying techniques offer the best opportunity for a business to increase its overall profits.

  • Monitor market trends. An upsurge in popularity of a certain beverage can lead to increased competition amongst vendors. Play them off against each other occasionally. Negotiate. You have nothing to lose!
  • Welcome new ideas. Purchasers should always be on the lookout for new ideas and new ways of reducing costs. Don't close your door to sales rep­resentatives. They may genuinely have something of interest to your establishment. Consider their promotional discounts.
  • "Opportunity buys." Don't rule them out. Take a look at items that may soon be discontinued or overstocked merchandise where a supplier has simply miscalculated demand. You could make big savings.
  • Cooperative purchasing. Consider "pool" purchasing with other enterprises. It can give you added purchasing power.
  • Change purchase unit size. Buy drinks in larger volumes. This can trim costs considerably, particu­larly in the case of liquor purchases where sell-by dates tend to be more generous.
  • Place multiple orders. Consider buying your full range of drinks from one wholesaler. It may offer you amazing reductions, especially if it's keen to do business with you on a repeat basis.

Topics: liquor inventory, inventory managers, Bar inventory, liquor purchasing, managing liquor inventory cost, bar business, Bar Management, Liquor Inventory savings, inventory control, managing liquor costs

Establishing Effective Purchasing & Receiving Strategies

Posted by Nick Kaoukis on Wed, Feb, 02, 2011 @ 14:02 PM
By Elizabeth Godsmark
Atlantic Publishing

Part 4 of 7: Simplify Purchasing Procedures and Define Duties

Keep Purchasing Procedures SimpleInventory Inspection Checklist sm

Whatever the size of your operation, certain repetitive purchasing procedures are unavoidable. At the very minimum, a buyer has to complete a purchasing requisition, a purchase order, a shipping instruction, a receiving report and carry out some form of quality control. Purchasing procedures, however, exist for a good reason. Save time, effort and money by simplifying them.

  • Change your attitude. Instead of viewing purchasing procedures as an irritation, think of them as a support system. Accurate documentation in this area has rescued many a business  from the jaws of liquidation.
  • Concentrate on basics. Buyers should always have adequate purchasing procedures in place. The key, however, is to avoid overkill. If a certain procedure in the buying cycle is irrelevant to your establishment, get rid of it. A written requisition, for example, may not be necessary if you regularly "call off stock ordered on a contract basis. Adapt and be flexible.
  • The purchasing requisition. Save time. Establish a pared-down requisition procedure that identifies ongoing requirements and automatically triggers the purchasing cycle.
  • The purchase order. No skimping here! The purchase order is a legal contract between purchaser and vendor. Even in small organiza­tions, the purchase order needs to be put in writing. Get it right. It can save time, hassle and money in the long run. A computer-generated purchase order considerably reduces human error.
  • The shipping instruction. Keep it simple. This piece of documentation is merely a confirmation of instructions from the buyer to the seller. Whether handwritten or computerized, the shipping instruction needs only to contain simple information. It should include the purchase order number for the shipment, and it, too, should be numbered for record-keeping purposes.
  • The receiving report. Again, simplify. Although an important document in the purchasing cycle, it only needs to contain basic information: the quantity and condition of the merchandise, whether the merchandise tallies with the original purchase order, a record of stock shortages, the recipient's signature and the date of receipt.

Define Your Purchasing Duties

It is all too easy to get bogged down in the day-to-day activities of purchasing. Remind yourself, occasionally, of your areas of responsibility. It helps you to focus on doing a good job.

  • Don't lose sight of your overall goal. Your responsibility, as a purchasing manager, is to maximize value so that your establishment gets the most for its money. No more, no less.
  • The cycle of duties. Always bear in mind that a purchaser's areas of responsibility cover an entire cycle of activities: identifying the needs of the establishment, planning, sourcing merchandise, purchasing, receiving, storing and issuing.
  • Control. Effective management and control of the purchasing cycle, with a constant eye on costs, is your number-one duty.
  • Dealing with vendors. The purchasing department (even if you are a one-man band) is responsible for all external dealings with vendors. The purchaser should be able to handle all vendor-related queries.
  • Avoid taking your purchasing problems onto the "shop floor." Front-of-house personnel will not appreciate interruptions while they are trying to please customers. Apart from emergencies, keep all purchasing queries for later.
  • High standards. It is the purchaser's duty to make sure that all merchandise purchased is fit for its purpose and of a consistently high quality. High standards = good value.

Topics: liquor inventory, inventory managers, Bar inventory, liquor purchasing, Lineup control, Bar Management, bar control, inventory counting, purchasing, inventory control