INVENTORY
- Why is Variance/Shrinkage so high in the hospitality industry?
- I use my GP% (gross profit percentages) to monitor my business – so aren’t I already tracking my variance?
- When should I consider outsourcing my business reporting?
- We are already so busy, how time consuming is it to get started?
- How much does a service like this cost?
- What sort of businesses does Barmetrix work with?
- How would my staff and managers respond to a system like this?
- What does variance really cost?
- Do you stop the service after the variance is reduced?
BARTENDER TRAINING
- Why is this a better option than just throwing my staff in the deep end on their first shift?
- Why would I bother training staff that are just going to leave in a few months anyway?
- I already have a head bartender responsible for training – would this system make this person redundant?
- How does the 1 year Barmetrix Training System work?
- Why does the Barmetrix Training Program work?
- You say your programs provide a ROI, how would I know if it worked for us?
MANAGEMENT WORKSHOPS
- Why would I want to pull my managers out of their job a few days a year to educate them?
- Is this a course for owners/GMs or all staff?
- Our managers have 10 years experience, what more could they learn?
- We have a solid business plan and a successful bar, why should we attend?
PROtrainer
- What is PROtrainer?
- How does PROtrainer work?
- Where would I put it?
- My management team are not very computer literate, could they use this?
- What would it do for my business?
- How will my staff respond to it?
INVENTORY
Why is Variance/Shrinkage so high in the hospitality industry?
There are 4 key factors that contribute to this problem:
- Selling partial units – Without the use of robotic dispense equipment this is a very difficult job. Opening a bottle and selling 1 ounce/30mls has always posed a challenge to our industry. Over recent years with the massive expansion of a typical product range it has become a much more challenging job to reconcile stock.
- The environment – If you put a bank teller in the same environment as a bartender (working in the dark, loud music, customers shouting and waving money, alcohol consumption, etc.) you would no doubt increase their error rate. A bartender’s environment is one of the most challenging to work within.
- Blurred lines, hundreds of years of tradition – Very few other industries allow employees to consume products on site during or after a shift. You wouldn’t see a grocery store clerk wandering around the store after work eating apples once they’ve signed off. Or a hardware store employee filling his pockets with nuts and bolts before leaving with a “one for the road” mentality. The fact that most bars allow staff to have a drink during or after their shift sends a mixed message and creates a working relationship that is fraught with complications.
- Lack of time, tools and expertise to reconcile stock on a regular basis - Unlike counting your tills at the end of every shift to keep individuals accountable, this is a bigger project that requires a certain expertise and a complex set of tools. Most bar managers do not specialize in database maintenance or report creation and even if they did, they lack the time to do the job properly.
Running a bar or restaurant at optimal levels of performance takes more than just strong reporting – it takes the implementation of a tried and proven system. That is what Barmetrix delivers to your business.
Industry average for variance/shrinkage ranges from 10% - 20% (depending on which country you are in) BUT YOU NO LONGER NEED TO CONCERN YOURSELF WITH AVERAGE! Barmetrix clients typically drive their losses below 3% after just a couple of months of working with us.
I use my GP% (gross profit percentages) to monitor my business – so aren’t I already tracking my variance?
Using your GP% to track your variance could very well be costing you thousands of dollars every month!
Traditionally GP% is factored by dividing monthly wholesale purchases against relevant retail sales (wholesale/retail). While this provides a picture of Gross Profit (GP) and Cost of Goods (COG) these numbers tell you little about losses that you are incurring. Strong GP figures alone do not demonstrate that your business is running free of variance.
To explain, consider the fact that it is possible for GP and VARIANCE to rise simultaneously! For example, an increase in theft of cash coincides with an increase in sales of high margin items (e.g. A bartender begins stealing at a time when you are selling more cocktails or bottled water than usual, etc.). In this case, both GP and VARIANCE would rise simultaneously, but in most bars around the world, only the increase in GP would be noticed.
If you are in business to maximize your profits, you need to get the facts not ballpark estimations.
Other factors that can contribute to a fluctuation in your GP% are:
- Wholesale costs and/or retail price fluctuations (this is a monthly occurrence)
- Purchasing decisions (bulk purchases are made for cost savings, supplier change, etc.)
- Dead stock (stock purchased but never sold)
- Category shift affected by seasons (e.g. more draught beer and cocktails sold in warmer months)
- Discounts, staff drinks and free drinks (few take into account the dramatic effect this has on GP)
- Variance and wastage (GP killers!)
- Non-sale items such as juice, post mix, etc. (cranberry juice has become as expensive as beer!)
- Par levels fluctuating (discontinuing a product line, changing menu, etc.)
Barmetrix reporting offers a perfect look into the ACTUAL performance of your business and an opportunity to gear your managers towards running your business to its potential rather than an arbitrary percentage.
When should I consider outsourcing my business reporting?
Any time you can have a professional take over a task for you and provide a strong return on investment you have to take a serious look at the proposition. Outsourcing is much more than a buzz word or a trend. It is a common practise of the top operators in the hospitality industry and is a key factor in business stability and consistent growth.
Here are some indicators that should prompt you to consider outsourcing:
- It's less expensive to have someone else do it than to buy the equipment and train an employee to do it in-house (and retrain someone else to do it when that person leaves).
- The activity can be done in-house, but it would drain resources that could be better used elsewhere that are already stretched.
- The skill required is so specialized that it's impractical to have an internal employee do it.
- The activity isn't one that staff enjoy doing or look forward to each week – so many put it off!
- Doing the activity internally could create turbulence between key staff or open the door to thieves being able to cover their tracks by reporting “everything’s fine!”
The general rule of outsourcing is simple: Subcontract any task that a professional can do more effectively and provide a strong return on investment. After all of the hard work that has gone into your business so far, you owe it to yourself to discover the true potential of your business. Getting Barmetrix involved in your business for 2 – 3 weeks is the best way to do this.
We are already so busy, how time consuming is it to get started?
Getting started is simple. Because we use our own equipment which runs independently to your existing business configuration there is no interference to the way you currently run your operation. All you need to supply is your sales file for the time period of the audit, your invoices for stock received, prices and recipes (which should already be on file) and access to the venue. It is that easy! From your first report, our consultants will be able to demonstrate the value of moving forward and provide an indication of the return on investment you can expect.
How much does a service like this cost?
Perhaps the best part of all of this is that Barmetrix will be an asset to your business not a cost.
- We charge a flat fee per audit (a quote is fast, easy and FREE)
- There are no long term contracts
- It is simple, our services provide a return on investment - or you stop using us! Giving you nothing to lose and everything to gain.
What sort of businesses does Barmetrix work with?
We work with hundreds of clients ranging from outlets that turn over 5K/week to venues that turn over 1M/week. We offer solutions to all types of operations ranging from pubs to bars to nightclubs to social clubs to restaurants and hotels. We can provide the industry’s best reporting and advice to any business that sells alcohol and/or food.
Typically we see our best results working with elite management teams or struggling businesses.
Why Is This?
Typically, the Top 20% and Bottom 20% of the industry are most willing to make changes and accept advice. The top 20%, because they have made a habit of constantly proactively upgrading their systems and operational procedures (which is why they lead the pack); and the bottom 20%, because they have little option but to make progressive changes.
Barmetrix is a business system that offers transparent reporting, aggressive variance reduction and progressive growth. But it is not for everybody. Those operators that are stuck in their ways that constantly utter the words, “that’s not the way we do things around here” may not be ideal Barmetrix clients. The fact is that we care about each account we have and if we are not able to create a productive relationship with a venue’s management team we generally terminate the relationship. There are so many businesses looking to make massive improvements that we will not bother to waste our time or the money of those that aren’t!
How would my staff and managers respond to a system like this?
This is a common concern and what we find is that most clients are pleasantly surprised.
Let me start by pointing out the obvious, any member of staff (this includes bartenders, kitchen staff, floor staff or managers) that subsidize their rent or car payments by stealing from your business are not going to enjoy the commencement of this service!
On the other hand, for the majority of the people employed they have no issue with it. In fact it becomes an advantage. Let me explain.
Managers enjoy the opportunity to take the business to the next level aided by a weekly reporting system to prove it!
Front line staff enjoy the competitive atmosphere and the transparency the reporting offers. Everyone wants to be part of and a contributing factor to a winning team!
What does variance really cost?
The biggest mistake a retailer can make is to think in terms of wholesale. Unless your business is losing stock off the delivery truck, it ALWAYS costs you more than the wholesale amount.
The fact of the matter is that your losses when factored accurately cost you a price much closer to your retail dollar value than your wholesale – and sometimes even more!
Hundreds of bar operators have changed their thinking on this subject which has lead to them changing their actions resulting in a massive change in their results. If you haven’t already – you should start to right now.
Do you stop the service after the variance is reduced?
This is a common misconception which leads to some costly decisions!
You don’t stop eating right and exercising when you reach your ideal weight (unless you want to rapidly pack the weight back on).
You don’t stop counting your tills when your cash balances (unless you want to lose your shirt!)
So why would you stop monitoring your inventory and business performance because you have begun to run it at an optimal level?
It is the repetition and awareness that has created the behaviours which has caused the results.
Furthermore, monitoring to maintain your low variance protects you against blow-outs, which can be caused by new staff, new products being miss-keyed, or sudden hidden financial pressures on your staff that may cause their behaviours to change!
BARTENDER TRAINING
Why is this a better option than just throwing my staff in the deep end on their first shift?
This has been a recipe for disaster for years. This sort of activity almost always leads to embarrassment for your new staff member, inconveniences the rest of your bar team and creates a horrible experience for your guests.
Remember, the brands of some of the biggest and most successful chains in the world have been built, not because of a better product, but because of better consistency. You may not get the world’s best food or coffee in some chain stores, but you do know exactly what you will get.
If a patron enters your bar and receives the same drink made three different ways, or waits 2 minutes for the first round and 10 minutes for next one, or is charged two different prices for the same drink – they are not going to feel encouraged to return. Your brand is important to your success and patrons need to feel they can expect a consistent level of service from every bartender, every time they come to the bar.
Besides damaging customer perception, consider what an untrained bartender can do to your bottom line! Over-pouring, undercharging, mis-keying and slow service speeds can all make your decision not to train your new team member an expensive one.
Finally ask yourself – if I am not training my bartender – who is? Bartenders can learn terrible habits from each other, and in workplace studies, it has been discovered that the habits of the most dominant personality in the team tend to form the basis for the majority of habits learned by new staff members. A new employee that is trained right from the start avoids such habits, knows what is expected of them, and will generally take delight in doing a good job!
Why would I bother training staff that are just going to leave in a few months anyway?
Firstly, a solid training program is proven to dramatically increase your staff retention. People feel more comfortable and take more pride in their work when they know exactly what is expected of them. Secondly, the old adage is so true that, “It is better to have trained staff that leave, than untrained staff that stay!”
An untrained staff member behind your bar for even one shift can do enough damage to your business and your bank account to make you regret your decision. Think of it this way – would you like a complete untrained novice to work on your new car? Or perform your surgery? Even cut your hair? Your patrons do not deserve to be charged money for inferior service, nor can you make money from staff who are over-pouring, under charging or serving twice as slow as the rest of the team.
Train your staff first to ensure they share your standards, your skills, and your priorities, before you make them responsible for your money.
I already have a head bartender responsible for training – would this system make this person redundant?
Absolutely not. Our programs and trainers would be the perfect complement to any existing training personnel. The combination of regular internal training and professional external help is the best system there is to produce competent, productive and profitable employees.
While we can teach you and your staff the skills necessary to be fantastic industry professionals, it is your own internal trainers that ensure this information is not lost and is constantly applied. Without a fantastic internal training manager watching, correcting and encouraging your staff (and getting them to use the PROtrainer), it is hard to see even the world’s best training make a lasting impact.
How does the 1 year Barmetrix Training System work?
All high performing, successful businesses have a regular program of external training to up skill their staff and improve their performance and output.
The Barmetrix Training System is designed to provide venues with a solid platform for bartender training & evaluation over the course of 12 months, one that complements and strengthens their internal training programs.
Sessions are scheduled bi-monthly or quarterly and venues choose from a range of modules to best suit their business needs, including:
- Speed & Efficiency
- Profitable Bartending
- Sales & Service
- Cocktails & Mixology (Quality and Consistency)
Each training module is combined with a comprehensive skills evaluation using our state of the art PROtrainer software program. Bartenders are assessed on pouring accuracy/technique, speed & quality of service – even numeracy!
The Barmetrix Training System offers venues a ‘ready made’ bartender training & development program – one that keeps the staff on their toes and focused on the bottom line all year!
Why does the Barmetrix Training Program work?
It’s fair to say that many hospitality staff (especially bartenders) have little in the way of formal training and/or qualifications when they enter the industry. The ‘baptism by fire’ mentality that is so rampant out there does little to teach new staff/bartenders much more than how to ‘survive’ a shift.
Once attending a Barmetrix training program, many bartenders say that they have had their ‘eyes opened’ – and wish they were taught this information years ago! Most of the bartenders we train and evaluate have NEVER been formally tested before – and are very interested to see how they perform against their peers.
While this type of training can be rewarding as a one-off event in terms of staff motivation and return on investment – the ideal is to create a CULTURE of profit consciousness and continual improvement. This happens when staff see the session as an ONGOING PROGRAM – ongoing investment into their skills and knowledge. Venue profitability and productivity becomes the standard outlook from the staff.
You say your programs provide a ROI, how would I know if it worked for us?
That is a great question, too many training organisations offer programs that have no clear success by which to measure them – making it hard to prove a return on investment.
The Barmetrix Training Programs are easy to measure because they all focus on making a direct impact on the bottom line. For example Profitable Bartending aims to reduce stock to sales variance by X%, Speed & Efficiency aims to increase productivity ($/hr) by X%, etc. These measurements are set with management and Barmetrix, with all staff stakeholders in the achievement of the target.
Outside of these specific measures, a program of ongoing training, assessment and development should have a positive impact on staff retention, i.e. an increase in a staff’s average length of stay at your venue.
MANAGEMENT WORKSHOPS
Why would I want to pull my managers out of their job a few days a year to educate them?
Long term business success is dependent on a balance of creative management thinking and time tested fundamentals – yet most of us never seem to find time to think, let alone creatively!
Most managers do not take any time out to work ‘on the business’ – rather than ‘in the business’ – even though doing so is critical to the future planning, growth and development of the business.
Barmetrix Management Workshops provide an opportunity for management to focus as a team on the important issues – such as driving productivity, improve marketing/HR systems, etc.
Additionally, the training days become a great opportunity to refresh and motivate the management team (who often spend much time motivating their staff and then forget about their own development!)
Barmetrix workshops bring together a unique mix of top industry speakers combined with a strong personal development message. Owners and group managers are delighted as they watch their management return to their business, fired-up with new ideas and bursting with enthusiasm – ready to make the business roar!
Is this a course for owners/GMs or all staff?
Owners, GMs and all those with the greatest influence over the business should always be the first to sign up for the Management Workshops – as all change starts from the top.
But ultimately, all levels of management will benefit from attending a Barmetrix Management Workshop– which is why we encourage each venue to attend in teams. There is a strong benefit to be had from bringing a range of management (junior to senior) and seeing what ideas/thoughts spring from the various individuals as the curriculum is presented.
Having younger, newer managers present with more senior managers means that everyone is on the same page and strategies can be progressed without leaving a key stakeholder out of the mix – plus it creates a healthy mentoring environment!
Our managers have 10 years experience, what more could they learn?
It doesn’t matter if your managers have 1 or 100 years experience – if there is not a clear commitment to continuous learning then you are losing a competitive edge.
Barmetrix Workshop attendees have hospitality management experience ranging from 2 weeks to 40 years – and we’ve yet to hear of someone leaving not having learned something new. Sometimes the value for managers is to have long lost knowledge refreshed and brought back into focus – as it can be all too easy to let the day to day detail of managing cloud what’s really important.
The key to creating a healthy, thriving business is great management – and no matter how much experience a manager may have, if he or she is not enthusiastically hunting for new information and ideas to improve themselves and your business – then they (and your profits) are likely treading water.
Remember – if you are not growing, you are stagnating – and the same applies to your knowledge and ideas.
We have a solid business plan and a successful bar, why should we attend?
Great! The likelihood is that you are already doing some type of external management training and/or development.
Over the years we have worked with literally hundreds and business and thousands of owners/ managers and we’ve noticed one thing very clearly – that the most frequent attendees and biggest supporters of our programs are the MOST SUCCESSFUL businesses!
There is no mystery here – top performers recognise top performers and know that, in order to keep themselves on top of their game, they must continually renew themselves from within. Attending the Barmetrix Workshops once a quarter is one of the easiest ways to ensure your team is constantly adapting and evolving to stay ahead of the market.
PROtrainer
What is PROtrainer?
PROtrainer is a world-first automated staff training system that is designed specifically to maximise staff knowledge and performance in hospitality-based venues and reduce the cost and time required to train staff.
PROtrainer allows any management team to easily train, evaluate and monitor every staff member on a daily or weekly basis and access high quality reporting in order to assess further training needs.
PROtrainer can be used for interviewing and/or inducting new staff, as well as up skilling and challenging existing staff. But perhaps most importantly, PROtrainer is easy and fun to play – making learning enjoyable and encouraging staff usage.
How does PROtrainer work?
PROtrainer is basically and ‘engine’ that drives the implementation and assessment of key skills and knowledge across all staff.
At the core of the system is a smart database, which holds all key venue information/videos and questions. The database comes pre-programmed with 1,000 industry relevant questions but is easily added to and tailored by each venue.
Staff log onto the system and have set ‘courses’ or ‘games’ allocated to them that they must complete. The unique interface is designed to be fun and interactive – almost like playing a video game (well suiting the generation Y’ers!).
All scores are captured and a range of useful reports can be generated, detailing group and individual usage, high/low scores, time taken to complete courses, etc.
Using the PROtrainer system allows in-house trainers, managers and HR coordinators to leverage their time, make learning flexible and adaptable to their staff, and perhaps most importantly – make it measurable.
Where would I put it?
The PROtrainer is a small, self contained touch screen computer (about the size of a small POS). You can attach it to a wall in the hallway, or sit it on a table in your staff room; but wherever you put it, make sure it is somewhere your staff will be forced to look at it and use it regularly.
Ensuring your staff has regular access and use of the PROtrainer will ensure you get the best results from it. Try making all your staff conduct a 5 minute pour test on themselves before each shift, and watch what happens to your liquor variance!
My management team are not very computer literate, could they use this?
If you management can use Microsoft Word then they can use this system. It has been designed by former bartenders and hotel managers so they know where you are coming from!
Basically, a manager just needs to switch it on, log in and all areas are easily accessible from the main screen. In case there are difficulties however, we have developed a comprehensive user manual as well as online help videos to ensure that you don’t get stuck!
What would it do for my business?
Well, that depends on how committed you are to change and improvement. You see, with the right focus, the PROtrainer can completely revolutionise your internal staff training & development (i.e. optimise the time it takes to induct new staff, minimise over pouring, maximise product knowledge, etc.)
It’s much like a treadmill - use regularly and correctly and you WILL lose weight. Use it as a coat-hanger and you will not see results. That said, even with minimal focus, many of our clients have seen great results because the staff actually LIKE playing the games; they enjoy having a fun interactive way to learn available to them.
How will my staff respond to it?
The feedback from staff has been phenomenal. The interactive games have been designed based on staff comments and suggestions – and the problem sometimes actually becomes limiting their usage!
Like all systems, the PROtrainer needs to be monitored by management, with regular reporting and feedback to staff. Once staff know that management are actively looking at the reports and their performance, they tend to see it as a standard part of their working environment.
After a while it becomes ‘the way we do it here’ (i.e. all new staff are formally and professionally inducted through the system and all staff complete a nightly skills & knowledge test before they start work.) What a culture to create!