Ms. Harralson

Food & Beverage

How Best to Protect Your Bar's Bottom Line

By Joanna Harralson, Vice President Operations, The Insight Group International

Are you aware - and in control of - what is happening in your hotel bar? How can you be certain that profits, which should be realized by your venue, are making it to your bottom line?

Take a look around. If there are no receipts or checks on the bartop in front of the seated guests; if there happens to be a key in the lock of a cash register drawer; if no video display terminals (VDTs) have been installed for the cash registers, or if loose coins and currency, as well as discarded check folders and other papers, are scattered across the countertop of the backbar, your bar could be experiencing some heavy losses.

Any of these instances are reason enough to seriously evaluate what is happening to payments made by guests and handled by your bartenders and servers. Is some of that money ending up in a bartender's pocket? Or perhaps, through carelessness or forgetfulness, does it represent drinks or food items never charged for, at all?

Oversight by Management an Imperative

Okay, so what can you do to right the possible wrongs which may be taking place? Hopefully, you are already doing everything possible through employee training and solid communication to explain the cash handling and service policies of your establishment to your employees. And you perform walk-throughs of your bar(s) on a regular basis to make certain everything is in order and cash is being transacted and making it into the register. Remember, scheduled evaluations by your hotel spotting company are major tools in your good management repertoire, but they must be supplemented by Management's continuous oversight.

As Vice President Operations for The Insight Group International, which has been a company leader in the hospitality spotting industry for the past 20 years, I've found that maintaining awareness of what's happening in their bar is an imperative for Management. Whether a bartender or server is careless, simply forgetful of how many drinks have been served, or actually dishonest and regularly pocketing payments, the result is the same-money that should be going into a venue's coffers isn't getting there. Over time, this can mean many thousands of dollars in cash profits being lost.

What You Should be Watching for and Why

There are, of course, some basic things to look for regularly, such as:

• A guest check or receipt should be on the bartop/tabletop in front of every ordering guest. Prompt cash register transactions when drink orders are placed and when they are paid for, with checks or receipts being immediately presented to guests, are added insurance against carelessness. Think about it-when a bartender keeps open cash checks, they often forget how many drinks they've served. And if a transaction isn't made for each drink order served, a dishonest employee, intent on stealing, can pocket the profits.
  
  In a single hour, our agents have watched employees pocket $100 while we've been seated at the bar. This can result in as much as $500 per night, per bartender, five nights per week-quite a substantial loss for a bar.

• Never, should keys be left in a cash register drawer lock. We strongly recommend that the ability to access cash drawers with keys be limited to managers, for obvious reasons.

• Bartender tips should always be kept in some type of container, preferably located two to three feet from the register. This discourages the practice of making 'quick change' for guests instead of making an actual register transaction. Loose change-currency or coin-on a countertop permits greater anonymity in mixing cash payments with cash tips, to say nothing of the messy appearance it creates. And such change left in discarded check folders is no better.

Tip: Backbar clutter (checks, folders, papers and other debris) is not only disorganized in appearance, but can cover a multitude of cash handling abuses, such as making notes or using counting devices to keep track of cash drawer 'overage' or 'shorts.'

Video Display Terminals

Another cash control tool is the use of remote or overhead display terminals for all registers. The ability to verify amounts charged at bar cash registers is almost impossible (unless you are directly in front of the register screen) without VDTs. With overhead display terminals, guests are permitted to view exactly what they are being charged, plus a way is provided to monitor a bartender's transactions, which can serve as a psychological deterrent to someone inclined to mishandle cash.

It is a good idea, also, to discourage barstaff from counting their own cash drawers at the end of each shift, as this can enable more than one cash-mishandling scenario. Rather, each bar staff member should remove all monies from the cash drawer and directly submit them to a designated person (i.e., venue manager) for counting. If cash shortages or overages are discovered it is cause for concern and needs further investigation to determine whether cash mishandling has occurred.

From Bottle to Bottom Line?

Management might also want to discourage the overpouring of liquor, as it is one of the ways profits can all-too-quickly be poured down the drain. The excessive providing of complimentary drinks is another.

Our agents have found that such overpouring is often a deliberate, calculated way to solicit bigger tips, but the practice can also be due to carelessness or lack of proper employee training. The use of bottle portion-control devices can be an effective line of defense against overpouring, as long as bartenders do not upend bottles a second time in a double-pouring effort to serve stronger drinks. When more liquor is poured than management has designated, either by the above method or excessively 'tailing' drinks, a bar's revenue can be considerably cut.

Encouraging larger tips can be facilitated by the 'gifting' of complimentary drinks to guests. Of course, such free drinks can be useful in pacifying a disgruntled guest or rewarding bar 'regulars,' but the practice can become all too common with no other reason than to encourage those tips. Management needs always to make its position clear regarding bartender/server authority to serve complimentary food or drink items and any subsequent documentation that may be required.

Management may want to review the above points of interest, as they comprise just a few of the things food and beverage managers can look for during regular walk-throughs of their venues.

Joanna Harralson, is VP Operations with The Insight Group. She has visited over 500 properties as a group trainer/evaluator, director of field operations, client liaison to management companies and provider of training to newly hired investigative agents. Ms. Harralson uses her knowledge, insight and expertise to evaluate employee integrity and to help drive the company's goal of premiere hospitality spotting agency. Prior to The Insight Group, Ms. Harralson rose through the ranks in hotels, as front desk clerk, server, bartender, concierge, auditor and sales and marketing specialist. Ms. Harralson can be contacted at (562) 694-3250 or jharralson@theinsightgroup.com Extended Bio...

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