Cut out Chaos

I had a few meetings last week with different bar managers and owners.  One bar manager recently took over a business that had no P&L statements or inventory history.  To make things worse, the staff wouldn’t do what was asked of them.  Even though this bar is one of the best looking bars in the area and has a great product, it's absolutely impossible to make money running a business like this.  If the staff knows you aren't watching every little thing that’s going across the bar they will rob you and leave you with pennies.

You need systems in place to operate a profitable business.  Whether you are just opening a bar or trying to make a bar profitable you must have systems in place for everything. The best business book for learning how to create systems in business is The E Myth, by Michael E. Gerber.  Here's an example of a staff organizational chart he includes in his book:

This chart shows how operations should be structured for a restaurant/bar business and who reports to who.  Obviously you may not need some positions (i.e. cloakroom attendant or valet) , but this chart should give you a solid starting point. 
You must assign every job on the chart to someone in your bar.  This means that one person could be the general manager, head of administration, and so on, but every person must answer to somebody.  You also need to write a detailed job description for every position with their key responsibilities.
 

The bar business is chaotic enough, so spend the time now on developing solid systems.  I guarentee you will thank me later.  

Here's how I ran my bars: I was in charge of operations and marketing, while my business partner was in charge of finance.  The head bartender was in charge of schedule, inventory, and ordering of products.  If the bar ran out of something I knew who to talk to.  If somebody didn’t show up for a shift I knew who to talk to.   This helped me give more responsibility to other staff members - for example if the bartender had a problem with something, they go to the head bartender.  If the head bartender can’t solve the problem, they go to the head of operations.  Everyone should know what they are in charge of and who they report to.  

Stealing Behind the Bar

Here's the solution: stay with the bartender at checkout between shifts.  This is a great time to ask questions, review how the shift went, and coach the bartender.  Asking if a bartender is stealing isn't the best way to handle the situation; calling them a thief will only make them defensive - definitely not the goal.  You want to keep them working with you as a team member and not against you.  So during the checkout, point out that there are inventory shortages each day.  Tell them to be more careful with their pours; cutting down on miss-pours during their shifts. This lets them know that you are watching the inventory closely and that you know something is going wrong during their shift.  Most bartenders get the point and straighten out.  If the problem reoccurs, keep addressing it the same way a few times.  If the inventory still doesn't add up then it's time to look for a new bartender.

Here's the scenario: you run a very tight business and closely watch everything that's going over the bar.  You realize that one of your top employees is giving away extra drinks to ensure a better tip.  What do you do?  You don't want to fire them, because they are one of your best bartenders and bring you good business.  But you must do something to protect yourself, so you don't losemoney.

 



Here's the solution: stay with the bartender at checkout between shifts.  This is a great time to ask questions, review how the shift went, and coach the bartender.  Asking if a bartender is stealing isn't the best way to handle the situation; calling them a thief will only make them defensive - definitely not the goal.  You want to keep them working with you as a team member and not against you.  So during the checkout, point out that there are inventory shortages each day.  Tell them to be more careful with their pours; cutting down on miss-pours during their shifts. This lets them know that you are watching the inventory closely and that you know something is going wrong during their shift.  Most bartenders get the point and straighten out.  If the problem reoccurs, keep addressing it the same way a few times.  If the inventory still doesn't add up then it's time to look for a new bartender.