Because we serve people, not drinks.
I love outrageous headlines. Last week’s headline 8 out of 10 Bartenders Steal was the most viewed post of the week. And as I said, I don’t think that 80% of bartenders are dishonest, nor do I think managers encourage theft by bartenders, however, in my experience, management policy and protocol is the largest contributor to pilferage in bars and restaurants.
How did you hire and train your last manager? You tapped your ‘best’ bartender or server, the one with the highest skill set, longest tenure, and best sense of hospitality. You then handed them a set of keys, gave them the combination to the safe, issued an alarm code, told them to make next week’s schedule, and gave them a pat on the back and said “Go manage”. You now have a manager who is good at opening doors, opening safes, and making schedules but doesn’t have the first clue on how to manage people, cash, or product. And you sacrificed the one employee who was the most productive of the team as far as guest relations is concerned. Did you bother to teach them how to determine profitability through inventory variance, how to determine employee productivity, or how to create a P/L? We tend to create babysitters, not managers.
Enough ranting about deficient managers. Lets talk about theft and how to mitigate it and its effects on profitability. As I stated in the previous article, I think most people are honest and that if you take away opportunity, most people will remain honest. I’d like to touch a bit on some things discussed last week and then explore other ways to prevent loss and what you and your managers should be doing.
Not only should you be conducting full inventories every week and determining variance of cost percentage, usage, and dollars, you should be doing this in front of your staff. They need to know you are serious about shrinkage. They need to see you are active in ensuring profitability. Do you bonus your manager on performance as related to hitting cost goals? Then why would you let that person conduct inventory? Ever here of the fox and the henhouse? It is human nature to hide our faults and failures; I think most managers skew numbers because of this rather than trying to earn their bonus. At the very least, if your manager is conducting inventory, you should be auditing their work (this goes for third party inventory companies as well) by recounting your top ten sales items.
Top ten spot auditing will tell you a lot about bartender honesty and training level. What I also like about it is the fact that once you conduct one, your whole staff will know within two hours that they may be next. A little fear and uncertainty goes a long way in stopping bartender hijinks.
Most of us don’t have time to watch 14 hours of tape a day. I find cameras effective for proving theft after a variance is found in inventory. Placement of cameras is of the utmost importance in preventing theft. There should be one in liquor storage, in the office viewing the safe, and directly on all cash registers with the tip jar in the frame.
Storage areas need to remain locked at all times. Keys should be issued to only one person per shift who is held accountable. If you must use a community key, please attach it to a large object so that any person who has it stands out clearly. As far as alarm codes are concerned, each employee who has building access must have a unique code so that you can audit who is unlocking and locking doors and when. It is also a good idea to set your alarm system to automatically arm itself at a set time after operations have ended and clean up should be finished. This keeps after hour parties from draining your stock.
Set a Good Example
If you or your managers have drinks or give drinks to guests during service, you should pay for those drinks. Don’t run a tab. Pay cash for each and every drink. Show your staff that no one drinks for free.
Bartender Comps and Promos
More than likely free drinks for big tips cause most of your loss. The easiest way to stop this is by allowing each bartender a shift spend. Giving staff members the ability to buy drinks for guests will keep them more honest. These drinks should be rang through the POS and a receipt should be kept detailing who the drink was purchased for and why. Bartenders should reward return guests and new guests with this spend, and not use it for getting friends drunk. A twenty-dollar spend per shift is a win, win, win marketing plan. Bartenders build their return guest business by buying a drink for customers and make a nice tip on the free drink, guests feel special and welcome when the bartender buys them a libation, and the business itself does better when that guest returns because of the good will shown. But again, all comps and promos must be tracked, audited, and proven worthy or you risk abuse of the system.
I’ve seen how you train your bartenders. It’s horrifying. Two examples:
Training and holding people accountable is the surest way to prevent loss. You must spend the time and money to do it correctly. policy and protocol must be on paper to hold employees accountable for the information. Testing employees on that information must be conducted. There are no shortcuts.
I truly believe that our most of our employee’s faults and deficiencies are the result of our faults and our deficiencies as owners and managers; we are not following best practices which cause the loss in profitability behind our bars. We’ll pick this back up next week (yes, there is a lot more to this).