By Duncan Colvin, Venners Consultant
In times of increasing business rates, product price rises and the many other difficulties that hotel, restaurant and bar operators face on a daily basis, finding new ways of tackling losses and improving profits has become vital for business survival. One of our most popular solutions for hospitality businesses is the completion of a discovery visit, which aims to identify where in your operation losses are occurring and in which areas profits aren’t being maximised. The actual results of these discovery visits have, on many occasions been quite a shock to operators, as our consultants expose countless secrets of what goes on behind closed doors. Today we’d like to share some of the most common of these revelations with you.
The top 10 secrets our consultants commonly uncover during discovery visits:
1. Staff use of tills is not always as it seems.
Our consultants frequently witness discounts being offered to friends and family and cash sales not being recorded. An operator should be able to expect every bar drink to be paid for. Sadly there are many occasions when this is simply not the case. The question needs to be asked: are all bar drinks paid for?
2. Staff exploiting the cashing up of tills.
Our consultants often note that too much trust is placed in staff to cash up their own tills and balance the cash alone and unsupervised. Although not all staff exploit this situation directly, it has come to light on multiple occasions that staff were covering their own tracks when it came to recording the refunded sales or number of times sales were voided. Our consultants discover if the cash check is witnessed and secure and will record who is cashing up the tills.
3. The tracking of cash and stock is foggy.
Checks made in the accounts office have at times discovered that accounts are not crediting bar sales to bar and food sales to food. Good stock control too is often not balanced by accurate revenue reporting. These situations make it incredibly hard to track your sales and stock, leaving you vulnerable to staff theft and incapable of refining your offers. Every sale should be correctly reported from start to finish.
4. Bad customer experiences.
Often businesses are losing money due to poor service, poor attention from staff and an atmosphere that doesn’t encourage a customer to return. These can have huge consequences on the business’ reputation and, in both the short run and the long run, your profits too. Our consultants’ visit can share real insight into how customers get treated when you’re not around.
5. Staff are missing significant sales opportunities.
Our consultants often spot staff with lacklustre attitudes, who are not making the most of considerable up-selling opportunities. The bar staff for example often miss chances to sell snacks, doubles or branded drinks. Not only that, they frequently notice staff failing to track customer spending across different areas of the operation. When our consultants visit a hotel for example they will always check if dinner is offered and if the breakfast taken is charged correctly.
6. Stock organisation and security is worryingly poor.
Our consultants’ observations of stock control procedures in the past have ranged from stock being left at open back doors, poor stock rotation, unlocked storage areas or poorly controlled transfers of stock from businesses in the same group. As professional stocktakers we cannot stress enough that proper stock control can help your business regain between 2-7% on GP%!
7. Menu pricing is not returning acceptable margins.
Our food consultants frequently not that not every menu item’s selling prices are set correctly. They’ll also often observe that waste is not being properly controlled and supplier relationships and ordering processes to make sure ingredients are bought at the best possible price. The losses restaurants and hotels can tackle by reviewing these with our consultants can be incredibly encouraging.
8. Hygiene and safety are not sufficiently regarded.
Our consultants always consider: is it safe, is it clean? Often stock loss is as a result of having to discard stock past its sell-by-date or because it was cross contaminated due to poor storage or processing. A safe, clean and well managed kitchen will always be more efficient and we often find that losses stem from not having sufficient or well-planned refrigerated storage space.
9. Staff are not up to the job they’re responsible for.
Venners consultants have broad experience of the industry and commonly find that staff have taken on too much responsibility or are poorly trained. A casual chat with staff as a third party helps to highlight training needs and can help resolve the problems that they encounter on a daily basis.
10. Managers are not able to cope with the demand
The final common observation made by our consultants during a discovery visit is that the management structure of a business is modelled around the strengths of a manager long since gone. The result of this is that the current management is left struggling and unable to run the operation efficiently and effectively. A new look at the staff and management structure has helped a number of businesses thrive and help all the team feel more settled and efficient.
What secrets would a discovery visit uncover in your business?
Not surprisingly the above mentioned issues can be relevant in almost all catering and hospitality businesses. The challenges uncovered at any site are varied and often lead our consultants to change direction and find new areas of stock loss or cash control. Using their expertise they will accompany each issue with well-founded recommendations, as well as examples of best practices witnessed elsewhere.
Our consultants understand the business controls that are required and, more importantly, have the experience to help affect the changes and improvements needed in your business. Supported by a nationwide stocktaking team, compliance auditors and health and safety assessors, there aren’t many issues that they cannot be addressed. Get in touch with us today for a free consultation.