How you lose upto 40% of sales

How you lose upto 40% of sales

The most important principle of managing and running a bar/club is to cut cost and reduce shrinkage. Stock sitting on the shelves represents money that has been invested and is now waiting to be turned into a profit. However, if some of that stock goes missing or cannot be accounted for, it means the bar’s profit has taken a direct hit. Shrinkage in bars, clubs and pubs is described as a reduction in inventory through the following:  Theft, Dilution and Replacement. Rogue staff at your club clearly knows how best to execute it. Masters of the game are rogue bartenders. They have perfected the game to a point you can hardly get them in the act regardless of any suspicion. To them this has become a norm. In majority of the clubs, rogue bartenders set themselves a target of between 5-8 tots/shots per day to steal from your inventory. The busier your joint is, the more your stock is prone to shrinkage. With an average cost of 250 Ksh per shot, as an investor you could be losing between 15000-20,000 Ksh in a week. And 500,000-800,000 Ksh annually.

Theft.

Theft is the act of taking and removing of personal property with intent to deprive the rightful owner of it. In almost all the clubs and bars in operation, every staff from cleaners to waiters have various ways of stealing tots/shots. Tots/shots are part of the inventory that is least secure at pubs, bars and clubs hence prone to theft than any other channel of revenue. In many clubs, cleaners have their own way of stealing a few tots stated in the course of cleaning the counter. To them this is a norm as it is hardly detected. In some clubs you will even notice that some rogue cleaners tend to spend more time cleaning the counter than any other part of the club. Some of them have tasted brands they could never think of buying. When it comes to the waiters, they also have their own way of stealing. They have a target clientele, those who order double tots/shots and above. Some use jargon such as ‘nyonga.’ When a client in your club orders a double tot, the waiter comes at the counter to place the order he/she throws in the jargon and immediately the barman understands. For instance, the clubs that use ‘nyonga,’ it’s the barman who is being told to compromise the exact volume of the tot/shot ordered. They mostly ‘nyonga’ 10ml of any double tot/shot ordered. In a good day, the waiter and barman could ‘nyonga’ up to 200ml which is equivalent to 5-6 tots/shots. This sale goes into their pockets. When this happens, your clients become the victim as their drink is compromised in quantity and your business ethics is put into question. In a good day the waiter and the bartender make up to 4000Ksh.

Dilution.

Dilution refers to the process of adding solvent to a solution to either decrease its concentration or increase volume or even both. In this context the process keeps the amount of solute constant, but increases the total amount of solution. Once a few tots/shots have been served, the bartenders devise ways of adding other solvents to keep the volume of the drink constant and conceal any theft detection. Water or a cheaper brand similar to the original are the solvents commonly used in many clubs. Once a bottle of e.g Johnnie Walker Red has been emptied with 15tots/shots, the bartender may decide to add a total of 5tots/shots of either water or a cheaper whisky (best whisky) as solvents. In the records the bartender will indicate to have sold 10tots/shots but in real sense sold 15tots/shots. The deficit of 5tots goes into their pockets. At a cost of 250Ksh per tot/shot, the rogue bartender makes 1250Ksh. If you thought that was surprising, wait until you hear the procedure used to add the solvents into the initial product. A few years ago when the liquor bottles didn’t have a cork inside, the bartenders were at ease with diluting. It was very easy and swift.  “After the introduction of the corks (popularly known as non-refillable caps),” this seemed quit challenging. However, after some time, the bartenders had discovered the hack of it. If the bartender wished to steal 5tots/shots of 30ml, they put this volume of preferred solvent either in full or partially into their mouth, then pump into the bottle with the cork and slowly the solvent mixes with the original product. While some uses syringes to pump the solvent inside.

Replacement.
Replacement refers to substitution/swapping of an item with a similar or different, inferior or superior, to the original item. This is where the bartender steals a full bottle of a particular brand. Best days of doing this are over the weekend and Monday mornings. Probably when your club was very busy and the sales were over the roof. On a good night, the bartender may sell 4 or more bottles of Johnnie Walker Red 750ml in form of tots/shots. At the time of taking stock and handing over to the next bartender, 1 full bottle of Johnnie Walker Red is introduced at the counter and recorded in the stock to conceal one of those sold. When your club sold 4 bottles of Johnnie Walker Red one definitely belonged to the bartender. From this act alone the bartender makes an average of 7000Ksh. Replacement of any bottle at the counter is a syndicate that involves a couple of staff; the waitress and the bartender. The waitress is used as the buyer and carrier of the bottle to the counter. They have perfected this act that not even through the CCTV cameras one can notice. The more bottles of tots/shots your club/pub sells, the more they steal from you.

When talking of shrinkage, this is how bar owners and investors are losing hundreds of millions very silently. The only way out for them is to device mechanism of reducing shrinkage and enhancing monitoring of stock. If you are a bar owner or an investor there is no doubt you need reduction of shrinkage or else, you will continue losing money and negatively affecting your ROI. Talk to Mustek Bar Solutions today for an effective, efficient, simple, accurate and accountable solution for you.

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