Expert Advice on Hospitality Topics

Making the Most from Sales

The savvy bar manager knows how to maximize profits and get the most sales possible without sacrificing ethics or drink quality. You can do the same if you follow a few simple tips. One simple way to maximize profits is by offering promotions or discounts. The small cost factor involved in initiating these promotions make them a good promotional vehicle.

"Happy hour," for example, a period of time when drink prices are generally reduced, can be an effective means of increasing bar sales. However, to be substantiated, it must draw a large volume of customers. "Happy hour" is most often run prior to opening the dining room, usually between 4 and 6 p.m. Drinks are sold at half-price or at a substantial discount. Hors d'oeuvres and salty snacks are often served, which will induce the customer's thirst.

In order to offset the enormous increase in the cost of sales due to the lower drink prices, total liquor sales must be increased substantially. A restaurant that lowers all drink prices by 50 percent during "happy hour" will be simul­taneously doubling its cost of sales. When analyzing the feasibility of a "happy hour," you must also consider the additional cost of labor during a non-operating period; the food cost of hors d'oeuvres and other snacks; and any variable costs, such as the use of additional utilities.

The gross profit margin during any "happy hour" is small, though it can be substantiated with sufficient sales. An increase in revenue, small as it may be, will be created where none had previously existed.

There are other possible benefits from initiating a "happy hour." Lounge customers will be exposed to the restaurant and may wish to return at a later date to try the dining room. Customers may stay past the "happy hour" period and purchase cocktails at the full price or remain for dinner.

Employees will also benefit from a "happy hour" by an increase in income through increased hours and tips. This point is an important consideration, as employees may become discouraged during periods of slow or seasonal business. A "happy hour" that may not provide the restaurant with the desired profit may be deemed worthwhile for increasing employee morale and decreasing job turnover, eliminating the costly expenditure of rehiring and retraining new personnel.

Bar Tabs

Another way to maximize spending, and your bar's profits, is with bar tabs. Bar tabs make it easier for customers to spend without hassle, encouraging multiple orders of drinks. To allow bar tabs or not is a policy that can be debated from both sides with sound reasoning. Many bars and restaurants have been victimized by customers who walk out and do not pay their tabs. A policy of no bar tabs will alleviate the initial problem, but it will certainly be inconvenient—and possibly insulting—to some customers.

A bar tab should always be run if a customer so desires. The lounge is a place where the customer may relax and enjoy a cocktail before dinner. He should not be inconvenienced by paying for each drink order as he goes along. Drinks should also be automatically added to the dinner bill unless the customer wishes otherwise.

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

Your 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

There 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

The nightclub business can be a rough. With a plentitude of competing venues, and with customer tastes in constant flux, the average half-life of a bar or nightclub is all too brief. Survival can depend on your ability to stay ahead of the curve and be in tune with your customers’ ever-changing demands. In short, you need to be constantly aware of what’s in  and what’s not in order to remain vital. Here is a brief compendium, in three parts, of some of the emerging and continuing trends in the industry, just a few things to look out for in 2012 and beyond:

Part 3 of 3: STORE CONCEPTS

Simplicity over pretention. While bars that employ top-notch mixologists offering creative drinks will continue to attract more and more customers, you can also expect a trend towards simplicity. As David Wondrich put it in Nation’s Restaurant News, “The biggest trend I see is bringing mixology down to the fun/dive-bar level.” Expect to find well-made, “sophisticated” drinks in friendlier, “less sophisticated” surroundings.

Live music and entertainment. Live acts are in. More and more bar patrons are looking to be entertained while they enjoy a drink or a bite. While live entertainment has always been a good  way to drive traffic to your store, drinkers and diners—particularly the over thirty crowd—are starting to look for it more and more. Thanks to the Internet, booking these acts—whether a local band, a jazz singer or comedian--is easier than ever before. What’s more, social media sites like Facebook and Myspace allow you to gauge the kind of following these acts have, giving you some idea of the level of traffic you might expect.

Bottle Service. With economic recovery on the horizon, expect bottle service to once again gain popularity. While it never really went away—at least not in the VIP lounges of the latest hotspots—bottle-service popularity did wane a bit during the recent economic meltdown. Look for a comeback.

“Daylife”. Daylife has begun to rival nightlife in bars and clubs across the country, especially during summertime. Rooftop bars and hotel pool areas are natural “hotspots” on sunny days. But patrons’ willingness to partake in daytime drinking shouldn’t be ignored, even if your store lacks a rooftop, pool or courtyard area. A weekend brunch bash or an early happy hour on weekdays can be just as profitable. Expect more and more bars to begin taking advantage of customers’ gameness for early revelry.

Larger Nightclubs. Expect to see larger—20,000+ square-foot—venues opening up in major cities. Also expect some of these new mega clubs to be segmented into distinct areas within. Instead of roped off VIP areas, you’ll begin to see entirely separate enclaves, or mini-clubs, within the larger store.

Multi-use spaces. Hand in hand with the (re-)emergence of larger nightclubs is the trend toward multi-use venues. Instead of putting all their eggs in one basket, drinking establishments will increasingly employ versatile-design  elements (such as colored glass walls that can be turned into projection TV’s) to start to cater to different clienteles. Expect to see multi-use spaces  that can be turned into dance clubs, live-music venues and sports bars.

Cocktail trucks. Where not prohibited by law, expect to see cocktail trucks peddling alcoholic concoctions. You may have noticed food trucks on street corners of major U.S. cities. Often run by talented chefs and would-be restaurateurs (who may lack the requisite capital to establish a more permanent store), these trucks offer a various, often high-quality, fare. This trend is now being extended to potables. In San Francisco, BrewTrucs can be seen  roving the streets hawking coctails and beer to thirsty pedestrians. Moreover, cocktail trucks have become a tool for liquor manufacturers nation-wide to build brand recognition. While legal issues will limit the growth of these bars on wheels, you may well see more and more of these trucks at parties and campus events.

The nightclub business can be a rough. With a plentitude of competing venues, and with customer tastes in constant flux, the average half-life of a bar or nightclub is all too brief. Survival can depend on your ability to stay ahead of the curve and be in tune with your customers’ ever-changing demands. In short, you need to be constantly aware of what’s in  and what’s not in order to remain vital. Here is a brief compendium, in three parts, of some of the emerging and continuing trends in the industry, just a few things to look out for in 2012 and beyond: