Controlling your beverage cost is about much more than hiring the right bartenders and being hopeful that they are honest.  Whether your hotel just opened a brand new bar or have had one for many years, make sure that you have these 12 basic internal control standards in place to protect your bottom line.

1.  Position the POS terminal so that customers can see transactions rung up. Most bars have the POS screen positioned towards the bar so that the bartender must turn their backs to use the register. This helps on two fronts; first, all guests can see their transactions rung up and second, it is tougher for the bartender to see who is watching him or her ring up the transaction, making it less likely that they will risk using POS manipulation. If your bar design does not allow the terminal to be placed this way, consider installing a display arm that can be positioned to face the guest similar to ones in retail stores.

2.  Ensure that it is your bar’s standard to have alcohol poured first when preparing mixed beverages. Pouring the mixer into the glass before the alcohol can only mean one thing; your bartender is attempting to adjust the perceived alcoholic strength of the beverage. This is a good indicator that your bartender may be pouring less per drink to steal so that it will not throw inventory levels off.

3.  Require the bartender to give a receipt after each transaction. This is one of the simplest standards to use yet many bars obviously do not require the bartender to give one. Make sure that your bartender knows that if a guest pays cash, it is not some secret code for, “I do not want a receipt.” Even if most of the guests throw the receipts away, at least your bartender gave them one and hopefully rang up the transaction.  Check out our article on how bartenders split and re-present checks with the POS.

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In our last article, we told you how to perfect your hotel’s in room dining service.  If you have mastered your service, you should be ready to increase your room service revenues (and tips) up to 50 percent!  In room service, your team has an incredible opportunity to sell.  Room service guests are typically not price sensitive and often want to splurge.  Here are the secrets of selling and increasing your revenue:

Before we talk about suggestive selling, the first thing we have to talk about is how to ask the right questions.  The most important thing to keep in mind is to never ask open ended questions.  When I call room service, the room service operator typically asks, ‘what can I get for you?’ or, ‘what would you like this evening?’  If you ask either of those questions, you have lost all opportunity to sell.  At that point you are only an order taker.  Your questions have to be specific and lead the guest to buy. 

The first question you should ask the guest is, ‘how many guests should I set the tray for?’  Almost nobody ever asks this question.  They usually just guess based on the number of entrees ordered or just assume that the order is for one person.  Without knowing how many guests the meal is for, you cannot set up the tray properly… but more importantly, you cannot sell correctly!

Once you know how many guests to prepare for, you can start selling.  Selling is simple.  It is about anticipating the guest’s needs and making recommendations to match. 

The next question you ask is to take guest’s appetizer order.  With all of the questions that you will ask the guest, keep the following in mind: (more…)

This book, written by Robert Plotkin, has been around for quite a few years and is in its fourth or fifth printing.  The book does a very good job of covering internal theft in bars.  The chapters range from ‘Exploring the Causes of Theft’ to ‘Preventative Measures‘.  At 96 pages long, the book is an easy read and serves as a decent reference.  If you are new to beverage control, you will find yourself going back to the book time and time again as you try to improve the controls in your bar.  A more experienced Bar Manager will not find much of the book very useful.

While there is a lot of great advice on preventative measures, the book does feel a little outdated.  Also, many of the recommendations for beverage control seem very costly when it comes to supervision.  Hotels that do not have a F&B Manager on the floor at all times will have a very hard time with the recommendations.  In addition, many of the recommendations are just way too time consuming and small to midsized hotels will have a hard time finding the time and manpower to do them. 

Overall, we recommend the book for managers who are new to beverage control.  Veteran mangers can probably skip this book.

Click here to download our free Banquet Bar Requisition Template

To download these instructions in PDF format, click here

Instructions for using the Five Diamond Hospitality Banquet Bar Requisition Worksheet To set up the file:

1. Create a new file for each event. You can either create a new file for each month or add each month to a separate tab within this worksheet.

2. Input the details of the event at the top of the spreadsheet. Only fill in the cells that are in blue!

After you requisition the liquor to banquets:

1. Fill in the amount that you requisitioned in the column labeled ‘requisitioned’.

2. Again, only fill in the cells in blue.

3. Add additional rows for additional types of liquor not listed.

After the event and banquets returns the unused alcohol:

1. Fill in the amount that is returned in the column labeled ‘returned’

2. Again, only fill in the cells in blue.

To view your cost for the event:

1. Input the amount of revenue you collected for the event at the very top of the spreadsheet.

2. Your cost for the event will be displayed right below your revenues.

3. Send a copy of the worksheet to accounting so they can transfer the amount to banquets.

To download these instructions in PDF format, click here

Opinion Polls & Market Research

After you vote in our poll, be sure to tell us a little about your beverage pour cost.

-What was your budgeted percentage last year?
-What was your final cost last year?
-What is the best advice that you can give to someone who is over budget?

Who has read ‘Burning Down the House: The Infamous Waiter & Bartender’s Scam Bible’?

This book was actually written to teach bartenders and servers how to steal from their restaurants and bars. The tagline on the back reads ‘Diners and Managers, beware!  Waiters and bartenders, give yourself a raise!’

It was written by two servers who work on Bourbon Street.  It is a quick read, you could probably finish it on your lunch break.  It is a very dangerous book! It covers the simple scams like check representing and the more complicating scams like the wagon wheel. A couple of the scams are far fetched or out of date, but the book does a good job of describing all of the ways a server or bartender can steal from your hotel.  The book is also pretty entertaining.  It is written in an edgy fashion and includes chapters like ‘Suggestive Stealing’ and ‘The Buffet Scam’.

Please add your comments about the book below… and if you buy the book, don’t leave it sitting around your office where your servers will see it!

There are many times when I am eating breakfast in a hotel when I wonder why hotels even offer buffets for breakfast in their restaurants.  I can see the answers from the executives now;  “It is a faster breakfast for our busy guests!”  Or, “The costs will be lower due to the high volume and less staffing!”  Or, “Our guests prefer to have a buffet!”  What I usually see when hotels offer buffets though, is terrible service.  I am sure the guests do not prefer bad service!  It is not that buffets and bad service go hand in hand, but it really gives servers a reason to become lazy.  The fact is that almost everyone will tip, whether or not they received good service, when they eat at a breakfast buffet.  The line between the self-service aspect of a buffet and the service side from the server often becomes blurred and a guest will just tip the customary ten to fifteen percent of the check no matter what type of service they receive, just to be courteous.

Nowadays, there are not many service oriented managers that do not know that the last impression a hotel makes on a guest, usually at breakfast, can heavily affect guest service scores.  Most people also probably know that customers would prefer no service to bad service (thus the invention of ATM machines).  Why then, would a hotel allow this type of service to go out to their guests in hopes of saving some money?  If you have a subpar breakfast buffet service, make sure that you have the following items in place to change that service for the better.

Standards – Ensure that your staff is familiar with the standards of your hotel brand and follows them.  If you do not have a brand, make some standards and follow them.

Host - Have a host.  This may seem like a useless cost, but having a host seat guests will make the restaurant seem more like a restaurant and not like a cafeteria.

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To download the Perpetual Beverage Inventory Template in Excel Format, click here.

To download these instructions in PDF format, click here.

To read an article on Perpetual Beverage Inventory, click here.

Instructions for using the Five Diamond Hospitality Perpetual Beverage Inventory

To set up the file:

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We often gets calls from hotels whose banquet bars are out of control. Whether the liquor pour cost is high, the employees are stealing cash or clients have complained about being overcharged on a host bar, the main culprit is usually a poor system for recording sales.

While our hotels all have the most advanced property management systems at the front desk and the most advanced point of sales systems in our restaurants and bars, our banquet bars have cheap cash registers purchased from Costco! Or worse yet, the old adding machine tape next to the cash drawer!

Finally, technology has caught up with the demand. Most hotels use the MICROS 3700 or the MICROS 9700 point of sale system in their restaurant and bars. Now it is very easy to add on an affordable, portable terminal and put in the same controls in your banquet bar as you have in your restaurant bar. The terminal runs on wireless internet and connects to your existing point of sales system so it is ultra portable. All that it needs is power. Depending on the size of your hotel’s banquet space, most hotels can get by with only one or two terminals.

How will adding a point of sales system to your banquet bar increase sales?

1. Your hotel will now be able to accept credit cards at a banquet event. People tend to spend much more money at a place (especially a bar) when using a credit card.

2. Many people at a business event will not purchase drinks unless they can use a company credit card and get a receipt. If you have ever attended an HFTP event, you have been in line behind a group of Controllers that want to pay with a company credit card and need a receipt for the expense report!

3. You will greatly reduce your risk of employee theft. You may be losing 20 percent of your revenues to theft right now. With a POS, the bartenders will have to ring up each item and present a receipt. More of the hotel’s money will make it into the register instead of ‘accidentally’ going into the tip jar.

If you have installed a Point of Sales System in the last few years or are planning to install one in the future, be sure to consider incorporating a banquet bar terminal. It will pay for itself in no time!

With all the focus on good bartender practices and internal controls, what about those “other” employees? All good practices should extend to anyone who has the words, “Serve Alcoholic Beverages”, in their job description. With cocktail servers so prevalent and necessary to provide good service in lounges everywhere, cocktail servers should be held to the same standards as all bartenders. The temptation and the opportunities for a cocktail server to steal are enormous because they work independently and self bank. Dishonest cocktail servers use a variety of methods to take advantage of their situations.

These methods can include:

Short-Changing – Stealing by not returning proper change to a guest. This happens as the guest can become less attentive as they become more intoxicated.

Overcharging – Charging more than necessary for a certain drink and stealing the difference. This usually happens when guests have no intention of seeing a receipt and the server quotes the drink price to them.

Substitutions – Charging for a requested premium liquor, but ordering a well brand from the bartender.

Representing Checks – Presenting the same check to two separate guests/transactions with the same order, then pocketing the cash from one or both transactions.

Fake Walk-Outs – Alleging that a party walked out, but pocketing the cash instead.

Altering Checks – Voiding or adding to checks. Usually goes hand in hand with representing checks.

With the following controls in place, you will curb the chance that your cocktail servers have to steal.

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