Tuesday, November 29, 2016

How To Sabotage Your Bar’s Business

Ever see a great bar or tavern with an ideal location and a perfect floor layout that isn’t making money. How can that be? Are not good locations and great floor layouts two of the prime factors in successful bars and taverns? Could the answer be sabotage?

All businesses should have two goals: 1) generate sales and 2) maximize profits. If bar owners aren‘t working towards those two goals they may be sabotaging their businesses. Below are the four common ways bar owners sabotage their bar’s success.

Drinking on The Job. For some reason many bar and tavern owners think its okay for them and their staffs to drink while tending bar. Think Applebee’s, Hooters, Green Mill etc. allow their managers and bartenders to drink while working? Absolutely not! Do CVS and Walgreens allow its employees to take drugs when they work? Let’s hope not.

It’s refreshing when I offer to buy a bartender a drink and hear them respond “We’re not allowed to drink on our shift … however buy me a chip and I promise I will have a drink on you tonight when I get off work”. I think that’s cool. 

Keeping Lousy Employees. For some reason bar owners retain marginal and incompetent employees far longer than most other business would. I think it’s because many are relatives; neighbors and family members of friends. We all know it’s hard to find good employees; especially people who are licensed and know how to properly mix drinks. However keeping a lack luster employees is costing you money. Find a new one and train them to be a great employee?

Tolerating Obnoxious Customers. Do banks, shoe stores and auto parts stores tolerate loud, obnoxious and foul mouth customers? Not many - if any. Most politely ask an obnoxious person to leave. Yet bar and taverns owners tolerate questionable customers and shrug it off as the cost of doing business. And that’s right it is costing them business. You bar stools should only be for good customers.

Giving Away Free Drinks. Bar and tavern owners perpetuate a myth that says giving away ‘free drinks’ helps prime the pump. Oh really? What pump is that? Dentists don’t give away free cleanings? Auto Mechanics don’t give away fee oil changes” so why do bar and tavern owners think they have to give away free drinks? 

The profit margin on drinks is small and giving away a dollar here and a dollar there adds up. 20 free cocktails and a dozen free beers is the equivalent to two six packs and almost a bottle of booze. Mechanics can afford to give away an oil change after a $600 transmission job and Dentists can afford to give away a free cleaning after a $3,000 set of braces but they don’t!

Since the New Year is about to arrive now is the perfect time to implement some new business practises to increase your sales and maximize your profits.

The first one is easy; don’t tolerate drinking on the job. Employees may not like it but this is America; they have the right to walk out whenever they want.

Second, terminate your worst employee immediately. Don’t say you don’t know who they are of course you do. It’s the one who generally arrives late and calls in sick often. Or the one who rings up the lowest sales each shift or the one with highest customer complaints. You know exactly who your worst employee is – so get rid of them and find a better one.

Third upgrade your customers. Never in public – but certainly in private - talk to your obnoxious customer’s one on one. Tell them you won’t be tolerating foul language - rudeness to other customers, or obnoxious behaviors anymore. The sooner you end or get rid of obnoxious customers the sooner you’ll have bar stools available for better customers.

Finally, begin to think of your inventory {your liquor} as cash. Before you give away any beer or booze think what you are doing? You are giving away money. Money you won’t generate when you give it away. Look at it this way, if the only reason as customer comes into your bar is to get free drinks then you don’t need that customer. Start making money.

Eba G is Profit Analyst for small bars and local tavern. Join Eba G. on face book and learn more ways to improve your sales and profits.

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