Owning a bar is exciting, but it’s like any other business. You have to work at it, and you have to feed it the proper “inputs.” In other words, it has to be properly staffed, the food has to be great (not just good), and the drinks have to offer at least a good value, if not an amazing value. One of the most common problems bar managers face is the “sinking hole” phenomenon – bars lose money very easily. Here’s how to protect yourself.
Staffing problems are pretty common in the bar industry. Most waitresses and bartenders are “working their way through college.” And while that’s fine, it’s no excuse to hire sub-par talent. Spend some time qualifying the people you hire, make sure they’re productive people, and avoid hiring family and friends unless you’re absolutely certain they’re good workers.
Spoiled Food and Drinks
Spoiled food can send you into the red very quickly. A Bepoz bar POS can help mitigate the problem, but it almost always comes back to the staff and your internal procedures for food handling and turnover. If you’re not promoting dishes and drinks, the ingredients are just going to sit in the back and rot. Keep tabs on trends in ordering. A good POS terminal can help you track which foods are most popular so that you don’t over or under-order supplies. This will go a long way toward minimizing waste.
You need refrigerators that work and stoves that cook. That much is obvious, but what about handling procedures for food and drinks? Don’t let beer sit out and get warm. Make sure that staff isn’t improperly storing supplies. Cooked items that are going into the freezer, for example, need to come to cool down a bit before you put plastic wrap on them. Why? Because the moisture and humidity that builds up is a perfect environment for pathogenic bacteria.
Poor Attitude or Atmosphere
Customers want a place where they can relax and receive great service. They come to your place because they want to drink, laugh, and chat with friends. If your bar is unpleasant, too dark, too light, smells funny, or is somehow not conducive to that relaxed bar atmosphere, it’s going to turn people off. That, in turn, is going to cost you money – a lot of it.
No Customer Concern
Bar managers are busy, but that doesn’t mean they should avoid or ignore customers. If a customer believes he or she is getting poor service, they don’t just keep it to themselves. They tell their friends. They tell their family. They tell pretty much everyone they know. No good.
Cutting Corners on Quality
Don’t cut corners on quality. Many bar managers use a multitude of ways to reduce costs. Most of the time, this means skimping on quality, but this is a mistake. They believe that offering less for more will result in larger profit margins. Customers aren’t dumb. They’ll catch on quickly that you overcharge for microwaved food, canned fruit, or frozen veggies. Once word gets out that you’re overcharging, or you don’t have great quality food, drinks, and your bar is in a general state of disarray, it’s game over.
Lack of Local Products
More and more people are coming to appreciate locally grown produce. This extend to the bar industry – more and more people want to drink local brews. If you’re not serving at least one local beer, wine, or spirit, you’re hurting your businesses. If you serve food, and you should, make sure you’re serving something that’s local and fresh.
No Business Plan
Last, but definitely not least, you need a business plan. If you don’t have one, odds are you’re going to be out of business within 5 years. Get to work on it. Write down your business goals, your revenue projections, your plans for growth and expansion, and your exit strategy if you want to retire.
Chris Allen is a veteran nightclub manager. He enjoys blogging about the best ways to create an inviting and profitable business.