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Article #1 - The Seven
Secrets to Successful Food & Beverage Control
The Seven Secrets to Successful Food & Beverage Control
Managing a successful business takes more than a welcoming smile! All your hard work could be in vain without a proper cost control system in place. So here are the seven golden rules of cost control that we have found to be used by the most successful bars and restaurants:
1. Keep it Simple
Because the Hospitality Industry relies as much on customer service as effective cost control (neither will exist without the other), any cost control system has to be simple for all involved. Over-complicating systems will keep your staff from the guests as well as allowing staff the opportunity to claim the system is too much work and difficult to complete, so keep it simple and practical.
2. Measure like against like
What I mean by this is that in order to set goals and targets and compare one period against another, both periods need to be the same. There is no point measuring a four week period that had three busy calendar weekends against a four week period that had four busy calendar weekends. By keeping periods the same (ie Monday to Sunday every week) you can start to identify trends and plan better for future periods.
3. Insist on speedy reporting
If it takes you too long to get the vital information you need from your business, then the chance are that any cost losses incurred during this period have continued into the subsequent period too, before you have had a chance to address them. Identify your KPIs (Key Performance Indicators) for each revenue department and be able to exact these figures as needed to give you a snapshot of how well you are doing and give you piece of mind until you get the report proper.
4. Don't Stop Controlling
If you stop controlling or see it as a one-day activity a couple of times a year, then you have missed the point. Control is a continuous action and would be better referred to as a "Mentality" than as an action. This goes back to a speedy reporting system and taking the time each day to review the KPIs. By tweaking smaller parts of the operation on a daily basis, you will achieve greater and smoother results as oppose to making large-scale changes periodically which may meet with opposition from less-like minded staff.
5. Measure it to Manage it
When it comes to Purchasing and Receiving, think like a bank clerk who has no allowance for cash handling errors. If he makes a mistake, he pays for it. Why operators allow any less of a mentality at the receiving door is beyond me but adhere to this principle and you won't go far wrong: "If it's ordered by weight, weigh it, If it's ordered by count, count it".
6. Know what your Costs SHOULD be
I have lost count of the number of operators who when asked how things were going, replied by saying that turnover was up which they were happy with, yet further questions revealed that they agreed the costs associated with the increased turnover were not proportionate and the expected profits were not forthcoming. Why? Because all of these businesses had one thing in common, none of them knew what it SHOULD cost to generate their turnover levels. Few operators had costed their menus down to the sprig of parsley and fewer could tell me the price of a loaf of bread! Surprised? Don't fall in to the same trap. Know what your costs should be irrespective of turnover, that way, you will be less likely to be faced with unwelcome surprises.
7. Know the Relationships of Costs
One principle which was drilled into me when I was a trainee manager was that costs are all relative to one another and no single cost can be examined independently of the other related costs. In other words, it's no good having a fantastically low cost base in your beverage if it's costed you double the normal labor costs to achieve that. Learn to relate the relevant costs with each other and review these costs together.
By investing the time and effort into establishing a watertight but manageable control system, you will be laying the foundations for a well managed and successful business. I often say to dubious operators that if they think it's expensive to setup and implement such a control system, just think what it will cost you if you don't!
You have been warned.....
For more helpful articles to help run a successful bar or club as well as hundreds of downloadable forms, templates and calculators, head on over to http://manageyourbar.com?affID=InsertYourAffiliateName
Article #2 - 10 Questions
to Ask Before Buying a Point of Sale System for Your Bar
10 Questions to Ask Before Buying a Point of Sale System for Your Bar
Before purchasing a POS system for your business, make sure you consider all the options and ask yourself the following questions.
1. How many cash registers/POS systems do I need?
When looking at the number of cash registers/POS systems to put in your establishment you will need to look at several things. The size of your establishment, do you serve food, do you want to expand your business in the future, are you considering opening more bars elsewhere, and so on?
Only by having a complete site survey from your POS supplier and discussing each of these points can you truly work out your needs.
2. Security Levels
What levels of security do you want to implement with your POS system? Do you want staff to sign on using ID codes, Dallas keys (magnetic keys assigned to each staff member), etc?
It is important that you know what levels of security you want from your POS system, from your part-time staff to the highest management levels. POS systems today allow you to set different access levels for different staff members, e.g maybe you only want senior management to be able to print off reports at the end of the day, and set other levels for bar staff so they are only given access to the cash register drawer to complete customer transactions, and nothing more.
3. Reporting Requirements.
What reports will you need at the end of the day, week or year?
You need to be aware that a basic POS/cash register system will limit you to printing off basic reports about that particular unit only.
A PC based POS system can allow you to see at any time of the day how your sales are performing, how much stock you have on hand, and so much more. Depending on what you want to find out, whether it be from one cash register, or from every POS system on your premises (if you choose to have them linked) you have complete control over your business.
4. Handhelds, cash registers, or both?
Handheld terminals are a wonderful invention, but you need to consider if you really need them. Handheld terminals are an expensive route to go down and you need to consider all options before deciding on this route. Most establishments are able to use just one cash register for food orders, sending the order direct to a printer in the kitchen, allocating table numbers. You also have the option of having your cash registers linked so you can float all sales between every cash register on your premises.
5. Control Levels
What level of control do you want over your stock & sales? The truth is you want the best controls possible. You can choose to operate your whole stock control from your POS system if you want to. Alternatively, you could outsource your Stock Control to an independent Stock Control Company.
By bringing in an independent Stock Controller you can save time, rather than counting all stock yourself, and you also have an independent report to compare with your own reports.
It is up to you to chose what levels of control you want. Make sure you discuss this with your POS company.
6. Budget
How much are you willing to spend or how much do you have to spend? A good POS company will provide you with the best system for your budget, not try to get you to spend more than you can afford.
Look at how much you are willing to spend and what you can allocate for the future should you need to upgrade your system.
7. Wireless systems or connected by wires.
Having a wireless system that is connected by WIFI (wireless connections) allows you to move cash registers around your establishment without the need for unplugging systems, etc. This may not be an option for you but this is excellent for bars that have a daytime carvery where they only need a POS system for a couple of hours in one part of the bar. A wireless POS system can be moved without hassle to another place in the bar and used for a certain time, and then moved back when lunch is complete.
Most establishments won't have need for a WIFI system, but it's another area to consider.
8. Installation & training.
It's all very well having a fabulous new POS system installed, but if you don't get good training on your system then what's the point of having it in the first place? A good system should be user friendly and take no longer than 20 minutes to learn.
When your system is installed, the company providing the equipment should also provide adequate training, with the option to have someone come back into your premises to go through the basics again. We all know that when we are shown how to do something and then left to it we come up with all sorts of questions. Making sure your installation company come back for a recap on the training allows you to ask these questions and refresh your training.
9. Software & Hardware Support.
Very important. You need to know that you have excellent software and hardware support should anything go wrong.
Knowing that you have support at the end of a phone line is great but what if you can't get hold of anyone. Make sure to get the support level agreements in writing with your POS supplier. A busy Saturday night with no cash registers could spell disaster for your business.
Both the company and the customer should keep a copy of this agreement, so you are covered from both angles. Invaluable.
10. Additional element -- CCTV
There are many additional elements you can install in your bar to increase the amounts of control you have in your business.
By installing CCTV you can keep an eye on all transactions taking place, your staff's movements, and other things taking place on your premises. To be really effective, CCTV should be used in conjunction with a PC based POS system allowing real time dial in to all your cash registers. See article on 'Does your POS system give you the control you need?'
These ten points should allow you focus on what are truly the most important considerations for your business when planning a purchase of a POS system.
For more helpful articles to help run a successful bar or club as well as hundreds of downloadable forms, templates and calculators, head on over to http://manageyourbar.com?affID=InsertYourAffiliateName
Article #3 - 10 Quick ways
to reduce your food costs today
10 Quick Ways to Reduce Your Food Cost Today
1.Engineer your menu
Not knowing the order in which your customers read your menu can cost you money. High margin items in the correct places on your menu will boost your bottom line time and time again. Download our Menu Item Placement article here. Address the layout of your menu for maximum impact today.
2.Develop a Standard Item List
How often have you wandered into the storerooms to find the most random selection of products that don't appear to be part of any recipe for current menu items? These items are costing you money. By developing a standard item list with your Chef based purely on the menu items, you are avoiding extra "nice to have" purchases which take up space and profits.
3.Develop a Master Price List
Many of your ingredients will vary in price depending on market availability, such as certain meats and vegetables, however you will still be able to develop a Master Price List which the chef can use for checking delivery prices against. This will be especially useful if you have locked suppliers into certain pricing for a period of time. Any overcharging can then be corrected at the receiving door before the invoice is paid. (insert link to Mater Price List here)
4.Conduct Regular Stocktakes/Inventories
If your freezers and stores are like any that I've come across in the past, then you most likely have a considerable amount of "dead" stock on hand. This may have come from incorrect deliveries, menu changes, over ordering, or any other number of reasons, but if you conduct regular inventories, you will be able to identify these items and find ways to use the stock that is still in good condition and free up space in your stores by getting rid of stock no longer usable. Remember, finding ways to create menu items without purchasing additional stock lowers your food cost every time.
5.Communicate with your staff
Letting your staff know what items cost highlights to them the value of wastage and shows them that you are on top of food cost control. Also keep wait staff informed of specials added to the menu so that can push these items to customers.
6.Know your recipes inside out
If you don't know the recipes cost of every item on your menu, you might as well forget about worrying about any other point on this list, because you won't have a food business for long. Every menu item needs a recipe card (insert link here) and every recipe card needs to be stored in a hardback folder in the kitchen so that all cooks and chefs work from the same recipe. The recipe cards need to be adjusted with ingredient price fluctuations. Do this before doing anything else to reduce your food cost because it might highlight inefficient items that can be ditched from your menu immediately.
7.Check deliveries religiously
It never fails to amaze me, that even in the busiest of restaurants, no-one is scheduled to receive deliveries. Instead, whatever cook or cleaner is on duty assumes the task of signing for the delivery, often without checking the quantity or quality of the items delivered. Assign a member of staff who isn't going to be busy with other task at delivery time and you may avoid short deliveries, incorrect deliveries, spoiled deliveries and over charging. Worth the effort?
8.Get and Read your Reports frequently
It's all very well implementing these suggestions, but if you can't see their impact on the bottom line, then they are truly in vain. Every operation is different and every situation needs specific solutions, so you need to know on a weekly basis what your food cost percentage is. You then need to compare this to your labour cost percentage and establish if you are within budget projections. Information is power and the more information you have as to the effect your changes are having, the easier it will be to plug the leaks when they occur.
9.Lower your stock levels
By lowering your stock levels, you are doing three things: You are reducing the likelihood of spoilage from overstocking and expiration, You are reducing the amount of cash tied up in stock in hand and you are forcing staff to be more efficient with available stocks and not be dependent on extra stock should the dish "not turn out right…".
10.Get out of the office
Perhaps the most important of all the suggestions. Too many managers lock themselves in the office during busy periods analysing figures when they should be out on the floor observing what has led to the poor results in the first place. In the US, regional managers from retailer Wal-Mart regularly ring the offices of store managers and if they pick up, they are asked what the hell they are doing in the office picking up the phone when they should be out on the floor managing the business!
For more helpful articles to help run a successful bar or club as well as hundreds of downloadable forms, templates and calculators, head on over to http://manageyourbar.com?affID=InsertYourAffiliateName
Article #4 - Why Staff Need
Incentives to Make You Money
Why Staff Need Incentives to Make You Money
Staff rarely have the same enthusiasm or drive for their work like you do as the business owner. I was reminded of this when a staff member came to remove my empty glass in the middle of my lunch yesterday, but didn’t offer me a refill. Had she offered, I would have taken another.
With staff members on duty, serving additional drinks doesn’t cost any more. So what can you do to make them more productive? Well training is obviously the first step; showing staff that upselling and increasing sales is part of their duties is the first step, followed by supervision. However, in my experience, incentives work the best.
In Ireland and The UK, tips are actually rare for service staff, because the law provides for a higher minimum wage. Compare this to the US, where a server’s wages are almost completely dependent on tips.
Modern cash registers/POS systems can track sales per staff member so that at the end of any shift, you will see at a glance which staff members are generating revenue. Why not offer a monthly bonus to staff based on the revenue they have generated. Perhaps a small percentage of their takings? Staff members who see that heir upselling results in increased wages will certainly make more of an effort with customers. You will see then which staff are motivated and which staff are not buying into the system.
What else should you consider?
Make sure to rotate where you assign staff so that all staff get a fair share of customers and that no staff member is left working in areas where they have no chance to generate extra takings.
For more helpful articles to help run a successful bar or club as well as hundreds of downloadable forms, templates and calculators, head on over to http://manageyourbar.com?affID=InsertYourAffiliateName
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Sample Blog Review of ManageYourBar.com
I recently stumbled upon a great website that all bar and restaurant owners should check out. The website is called ManageYourBar.com.
ManageYourBar.com is a Toolkit for Bar Owners. The website is made up of more than 500 different How-To Articles, Downloadable Training Manuals, Pre-Written Human Resource Forms, Cost Calculators, Profit Analysis Tools, Inventory Control Sheets, Vendor Checklists as well as hundreds of Expert Features with more added each week that focus on specific areas of a business where precious money can be made or lost. Just last week they had an audio interview with the King of Cocktails Dale De Groff which I found very interesting.
ManageYourBar.com is a membership website which means that as a member, you get immediate access to EVERYTHING on the website. Bear in mind that all of the Downloadable Forms & Templates are created in Microsoft Word & Excel meaning you can edit all of the Templates as required at no extra charge! I love it!
Having had a good look through the website I would say that ManageYourBar.com is not for everyone. You won't get value out of the website if your food cost, beverage cost and labor cost are perfectly on target or if you have streamlined every aspect of your business.
If, on the other hand, you feel your business or your own knowledge could be improved, if even by the slightest margin, then you have absolutely nothing to lose. Lets face it, who couldn't use some extra help in the current economy?
They have a great risk free trial offer running at the moment, so if you wanted to test drive the website for yourself, now is the time to do it!
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10 Quick Ways to Reduce Your Food Cost Today http://www.manageyourbar.com/public/213.cfm?affID=InsertAffiliateNameHere
10 Questions to ask before buying a POS sytem for your bar http://www.manageyourbar.com/public/112.cfm?affID=InsertAffiliateNameHere
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I came across this great website to help you manage your bar: http://www.manageyourbar.com?affID=InsertAffiliateNameHere
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