What can hotels do to ensure a profitable F&B operation?
Running profitable hotel F&B requires focus and the ability to understand what’s happening right across the business at all times. Every facet, including procurement, retail transactions, operations, stock control and security require robust controls in order to guard against significant losses. That means having robust systems in place. Malcolm Muir, our Director of Consultancy, explains that better controls can translate into a significantly more profitable hotel business.
Watch our 2-minute video below to find out how your business could be affected!
As hotel operators, you cannot underestimate the importance of following good stock management and profit protection processes. Doing so will ensure that you keep shrinkage low and improve margins. It’ll help you maintain an optimum level of stockholding and where there are cultural problems, help you eliminate the significant losses attributed to internal theft and fraud.
Regular stocktaking is a proven way to reduce losses and improve profitability. A good stocktaker can help you optimise your stockholding, zone in on areas of loss and highlight opportunities for profit – which will typically increase your GP% on F&B by between three and seven percent.
Breakfast buffets and continental breakfasts are another area where you can find significant profitability increases too. Taking the time to benchmark and optimise margins on breakfast delivery have been found to save you tens of thousands each year on procurement and reduced wastage. Keeping your margins tight and knowing ‘absolute’ portion measurements is the key here.
Theft and fraud can pose major problems for hoteliers and it’s important to recognise the risks and have measures in place. Theft is all too common, with myriad points of vulnerability across a hotel’s operational areas. If there are a lack of controls in place, a single member of bar staff could easily steal around £50,000 of stock or cash over the course of a year. In hotels where internal theft does occur, it’s likely that theft is being committed by more than one employee, which can double or triple the profit erosion.
It’s not always malpractice either. Significant losses can occur when staff are not trained to achieve full revenue transactions. For example, not charging for the largest measure, or for mixers. These simple errors stack up over time and so having controls in place to detect and rectify these shortfalls can be valuable.
Also, look out for holes in your customer transaction communications. Huge amounts of profit can be lost when meals, drinks tabs and other payments go unattributed between your restaurant and front desk. Ensuring your customers are charged for everything they consume is imperative to running a profitable hotel. To minimise risk, we suggest running penetration tests to highlight the current scale of risk and help you plug operational holes that are costing you large sums of money.
Our Hotel Loss Prevention Services can help you improve your stock controls, increase food margins and reduce the damaging effects of internal theft and human error. For more information or to book a free consultation click here.