Employee and Staff Management for Beverage Businesses

ChapterChapterChapterChapter 8888
Bar and Beverage ManagementBar and Beverage ManagementBar and Beverage ManagementBar and Beverage ManagementBar and Beverage ManagementBar and Beverage ManagementBar and Beverage ManagementBar and Beverage Management
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Today’s Beverage IndustryToday’s Beverage Industry
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Today’s Beverage IndustryToday’s Beverage Industry

Today’s Beverage Industry
SinceSinceSinceSince 1990199019901990, there has been a gradual decline in alcohol, there has been a gradual decline in alcohol, there has been a gradual decline in alcohol, there has been a gradual decline in alcohol
consumption.consumption.consumption.consumption.
What people are drinking (and trend)?What people are drinking (and trend)?What people are drinking (and trend)?What people are drinking (and trend)?What people are drinking (and trend)?What people are drinking (and trend)?What people are drinking (and trend)?What people are drinking (and trend)?
The health-and-fitness enthusiast looks for lighter drinks (less alcohol
and fewer calories);
Sales of spirits (high in alcohol and calories) continue to decline;
“White goods” (vodka, gin, rum and tequila) do better than “brown
goods” (bourbon, Scotch and other whiskies), although they all have
similar alcohol content;
FBM-343 Beverage and Bar Management . ก3333
similar alcohol content;
Beer sales look mighty impressive when compared to wine and spirits;
Most restaurants recently offer wines by the glass in addition to wine
by the bottle

Beverage & Bar Business
The BeverageThe BeverageThe BeverageThe Beverage----Only Bar:Only Bar:Only Bar:Only Bar:
The simplest kind of beverage enterprise that serves beverage
alone except snacks (i.e. peanut, pretzels, cheese and cracker).alone except snacks (i.e. peanut, pretzels, cheese and cracker).
Beverage-only bars are definitely a minority today. Although
some are highly profitable, serving liquor alone is sometime not
enough to attract and keep customers.
Bar/Entertainment Combinations:Bar/Entertainment Combinations:Bar/Entertainment Combinations:Bar/Entertainment Combinations:
Bars that usually offers a wide range of entertainment i.e. the
neighborhood bar with pool, pinball, dartboards or giant TV
screens; nightclubs with entertainers; comedy clubs; ballrooms with
neighborhood bar with pool, pinball, dartboards or giant TV
screens; nightclubs with entertainers; comedy clubs; ballrooms with
big bands, etc.
In between are cocktail lounges and nightclubs with live
entertainment i.e. piano bars, country-and-western dancing, jazz,
duos, etc.

Beverage & Bar Business
Bars and the Smoking DebateBars and the Smoking DebateBars and the Smoking DebateBars and the Smoking Debate
The cigar bar is another trendy addition to the
beverage scene—and a profitable one, too.beverage scene—and a profitable one, too.
Customers who enjoy high-priced cigars also have
the opportunity to order premium spirits, wines,
beers, and after-dinner drinks to accompany them.
The cigar boom is not legal in all venues since
smoking is prohibited in many public places by local
and/or state ordinance.
Airline Beverage ServicesAirline Beverage ServicesAirline Beverage ServicesAirline Beverage Services::::
and/or state ordinance.
Airline Beverage ServicesAirline Beverage ServicesAirline Beverage ServicesAirline Beverage Services::::
Beverage services that are provided on airline
flights.

Beverage & Bar Business (cont.)
Food and Beverage Combination:Food and Beverage Combination:Food and Beverage Combination:Food and Beverage Combination:
One type is the restaurant/bar – drinks/wines are part of the meal
service, served by the same wait staff that serves meals;
Another type of food-beverage combination is bar that offers light
service, served by the same wait staff that serves meals;
Another type of food-beverage combination is bar that offers light
food in addition to drinks;
A special variation of food-beverage combination is the wine barwine barwine barwine bar
A brew pub – a beer version of the wine bar
Hotel Beverage Operations:Hotel Beverage Operations:Hotel Beverage Operations:Hotel Beverage Operations:
Beverage services differs in many ways (with different purposes)
from the bar or the bar-restaurant combination in hotels (i.e. lobby
from the bar or the bar-restaurant combination in hotels (i.e. lobby
bar, cocktail lounge, restaurant bar, a nightclub with dancing, room
service, minibar etc).
FBM-343 Beverage and Bar Management

Similarities and Differences
Grouping types of beverage service into these rather
arbitrary categories does not really adequately
describe the character of individual enterprises.describe the character of individual enterprises.
Many establishments do not fit handily into a specific
category, and those within categories can be as
different as day and night. Yet all categories have
certain similarities.
They all sell alcoholic beverages. They have similar
staff structures, patterns of purchasing and inventory,
They all sell alcoholic beverages. They have similar
staff structures, patterns of purchasing and inventory,
and ways of controlling the merchandise.

Similarities and Differences
A successful business meets the needs and
desires of a certain clientele and strives to be
deliberately different from others serving adeliberately different from others serving a
similar clientele in order to stand out in the
competition for customers.
Other major reasons for the wide variety of bar
operations are simple: the special circumstances
of each operation, as well as the personalities,
of each operation, as well as the personalities,
desires, and budgets of their owners. But to be
successful, the entrepreneur must put clientele
above all else in shaping his or her enterprise.

Employee ManagementEmployee ManagementEmployee ManagementEmployee ManagementEmployee ManagementEmployee ManagementEmployee ManagementEmployee Management
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Employee ManagementEmployee ManagementEmployee ManagementEmployee ManagementEmployee ManagementEmployee ManagementEmployee ManagementEmployee Management

Employee ManagementEmployee ManagementEmployee ManagementEmployee Management
Employees affect your profits in many other ways. They
are important links in any cost-control system. They
are your best merchandising agents. To yourare your best merchandising agents. To your
customers, they represent you and your philosophy. So
how do you go about finding the right people and
putting them all together to function in a smooth
operation?
The kinds of employees you will need depend a great
deal on your type of beverage business. First we’ll look
deal on your type of beverage business. First we’ll look
at the entire spectrum of staff positions, then we will
consider how to determine your own staffing needs.

Staff PositionStaff PositionStaff PositionStaff PositionStaff PositionStaff PositionStaff PositionStaff Position
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Staff PositionStaff PositionStaff PositionStaff PositionStaff PositionStaff PositionStaff PositionStaff Position

Staff PositionStaff PositionStaff PositionStaff Position
The staff needs of bars are unique to each
establishment, and there is probably no bar that
has all of the positions that we describe.has all of the positions that we describe.

1111.... The BartenderThe BartenderThe BartenderThe Bartender
The central figure in any beverage
operation is the bartenderbartenderbartenderbartender,,,, who is
an amalgam of salesperson,
entertainer, mixologist, andentertainer, mixologist, and
psychologist
Of course the bartender’s primary
function is to mix and serve drinks
for patrons at the bar and/or to
pour drinks for table customers
served by waiters or waitresses.
served by waiters or waitresses.
The bartender is typically a host
and a promoter whose combination
of skill and style translates into
publicrelations benefits that build
goodwill and good business.

The BartenderThe BartenderThe BartenderThe Bartender
Bartending is as wide-ranging a job as you can get
in the foodservice business, and it is never as
simple—or as glamorous—as it seems.simple—or as glamorous—as it seems.
The bartender is: the person who notices when the
bar is getting crowded and crazy, and uses eye
contact and a smile to buy time when newcomers
or singles approach the bar; the person whose wit,
wisdom, and approachability make him or her the
center of conversation and the purveyor of both
advice and drink concoctions; the person who can
advice and drink concoctions; the person who can
hold court behind a sleek bar at the ritziest private
party or unclog the men’s-room sink in a pinch.
Bartending requires certain skills and aptitudes, not
the least of which are patience, adaptability, and a
good attitude.

When you’re looking for candidates for
a bartender job consider these points:
1. Sex makes no difference.1. Sex makes no difference.
2. The bartender is a good host
3. The bartender is a diplomat
4. The bartender is an authority figure
5. The bartender is a role model
6. The bartender knows how to mix a drink
6. The bartender knows how to mix a drink
7. The bartender pays attention to detail
8. The bartender is imaginative and fun

ALL I REALLY NEED TO KNOW I LEARNED BARTENDINGALL I REALLY NEED TO KNOW I LEARNED BARTENDINGALL I REALLY NEED TO KNOW I LEARNED BARTENDINGALL I REALLY NEED TO KNOW I LEARNED BARTENDING
Everything I really need to know about how to
exist in this world, personal or business, I learned
bartending. This knowledge was shared with mebartending. This knowledge was shared with me
by owners, managers, salesmen, waitresses,
waiters, bartenders, and customers.
Most of these teachers were successful in life’s
everyday challenges. These tips you cannot
spend, they are the tips you keep for life:
spend, they are the tips you keep for life:

ALL I REALLY NEED TO KNOW I LEARNED BARTENDINGALL I REALLY NEED TO KNOW I LEARNED BARTENDINGALL I REALLY NEED TO KNOW I LEARNED BARTENDINGALL I REALLY NEED TO KNOW I LEARNED BARTENDING
Give everyone a fair shot.
If you haven’t anything nice to
say, don’t say it.
Use the BEST premium products
Wear a clean shirt every day.
Don’t cheat or steal.
Smile!
Keep your hands and fingernailsUse the BEST premium products
and you’ll be the BEST.
Serve.
Be the solution to the problem,
not part of the problem.
Don’t drink and drive, don’t let
others.
Respect salesmen, you’re one.
Don’t take sides. You’ll make
Keep your hands and fingernails
clean.
Use Mr., Sir, or Ms. when
talking to strangers.
Don’t be a part of a rumor.
Keep your space clean.
Don’t waste.
Be on time.
Don’t take sides. You’ll make
two enemies.
Be NEAT.
Be on time.
Help others when they’re busy.
Don’t use the easy way. Use the
right way.
Don’t give up. Follow your
dream.

2. The Barback
A barback typically relieves the bartender of all chores
except pouring the drinks and handling the customers
and the cash register.and the cash register.
A barback may be responsible for any or all of the
following tasks: setting up the bar; preparing garnishes,
special mixes, and syrups; filling ice bins; washing
glassware and utensils; maintaining supplies of towels,
napkins, picks, straws, stir sticks, and matches; keeping
bar surfaces and ashtrays clean; washing fixtures; and
bar surfaces and ashtrays clean; washing fixtures; and
mopping floors.

2. The Barback
The barback is also a runner or gofer, who goes for liquors,
beers, wines, and other supplies as needed by the bartender.
Often a barback is an apprentice bartender and may serve beer
or mix simple drinks under the bartender’s supervision. In short
Often a barback is an apprentice bartender and may serve beer
or mix simple drinks under the bartender’s supervision. In short
a barback program is an excellent way to always have people in
training for bartending positions.

3333.... The Server
Beverage service at tables, whether in a cocktail
lounge or in a dining room, is handled by waiters
or waitresses, a group collectively referred to as
servers. Servers record the customers’ drink
or waitresses, a group collectively referred to as
servers. Servers record the customers’ drink
orders, transmit them to the bartender, pick up
the drinks, serve the customers, present the tab,
and collect payment
Like the bartender, the server is also a host and
a promoter. A few basic requirements for table
a promoter. A few basic requirements for table
servers include a pleasant personality, a neat and
attractive appearance, poise, and a mind for
detail

3333.... The Server
The server must actually offer cocktails, wine, or beer to every
table. As elementary as it sounds, failure to ask for the sale is
the principal reason that a sale is not made. And remember,
there are numerous opportunities during every guest’s visitthere are numerous opportunities during every guest’s visit
when a selling suggestion is appropriate. A good training
program should help servers learn these important cues.
The server must make it known to customers that he or she is
happy to assist them in selecting a beverage. Again, training
gives your server these skills, which builds their confidence
and improves your business. At the very least good bar service
requires a basic knowledge of a broad array of drinks and
some variations, so the server can pin down the customer’s
requires a basic knowledge of a broad array of drinks and
some variations, so the server can pin down the customer’s
exact preferences: Does he want his Martini with an olive or a
lemon twist? Does she want her Sour straight up or on the
rocks? The best cocktail server’s drink knowledge is almost as
extensive as a bartender’s. A server may even mix drinks to
allow the bartender to take a break.

3333.... The Server
In many restaurants waiters and waitresses serve
both food and drinks, including wine by the
bottle, with the meal. Servers must be able tobottle, with the meal. Servers must be able to
open a wine bottle properly, carry out the rituals
of wine service, and answer questions about
wines, specialty drinks, and recipes.

4444.... The Wine Steward or Sommelier
Fine restaurants that feature elegant
service may have a management-level
employee who handles the orderingemployee who handles the ordering
and serving of wine. The wine stewardwine stewardwine stewardwine steward
(also called the cellarmaster,cellarmaster,cellarmaster,cellarmaster,
winemaster, wine captain, or wine
waiter, all terms applying to both
sexes) presents the wine list at the
sexes) presents the wine list at the
table, makes recommendations,
discusses wines with customers, and
takes care of serving the wines

In addition to being part of the serving staff, a
well-qualified wine waiter can become an integral
part of the management team, who can do any orpart of the management team, who can do any or
all of the following:

Create a wine list that fits your atmosphere and
menu.
Deal with suppliers and importers and order wine.Deal with suppliers and importers and order wine.
Negotiate exclusive deals to carry certain wines
in your market.
Control and keep inventory of the cellar or wine-
storage area.
storage area.
Make purchasing decisions to maximize profits, in
some situations this includes buying wines to
store for future years’ lists.

Train your servers and other staff members in
wine appreciation.
Orchestrate and help publicize tastings, wineOrchestrate and help publicize tastings, wine
dinners, seminars, and other winerelated events
for your business.

5555.... Security Positions
This may come in the form of a
doorman or door person. This
person is expected to keep order if
there are long lines to get in, to
person is expected to keep order if
there are long lines to get in, to
ask for customers’ identification
(and firmly but politely enforce a
dress code or refuse to admit
underage people), and to collect a
cover chargecover chargecover chargecover charge at the front door.
The cover charge is a fee for
The cover charge is a fee for
admittance to the bar, and is
sometimes given to or split with
the band if there’s live music.

6. Beverage-Management Positions
In very large operations the beverage steward may
work for the beverage manager or beverage director.
This is often a senior-management position, part of theThis is often a senior-management position, part of the
team that runs a corporate operation: a hotel, a large
nightclub, a high-volume restaurant, or an entire hotel
or restaurant chain.
The beverage director is in charge of hiring, training,
and supervising all beverage-related personnel;
purchasing all beverages and beverage equipment;
purchasing all beverages and beverage equipment;
establishing and maintaining inventory and control
systems; setting standards; and making policy on
matters relating to beverage operation.

A beverage director is either part of, or reports to, top
management.
In some large organizations responsibility for food-In some large organizations responsibility for food-
and-beverage service is combined into one position
called the food-and-beverage director.
Such management positions require several years of
industry experience, preferably firsthand experience in
each area of responsibility.
each area of responsibility.

following list of qualities that you will find in the
best bar managers:
1. Business training.1. Business training.
2. Market knowledge
3. Desire to lead
4. Maturity and stability
5. Financial wisdom
5. Financial wisdom
6. Street smarts
7. Legal knowledge

A manager’s overall responsibilities may include
hiring and firing;hiring and firing;hiring and firing;hiring and firing;
training, scheduling, andtraining, scheduling, andtraining, scheduling, andtraining, scheduling, andtraining, scheduling, andtraining, scheduling, andtraining, scheduling, andtraining, scheduling, and
supervising personnel;supervising personnel;supervising personnel;supervising personnel;
forecasting and budgeting;forecasting and budgeting;forecasting and budgeting;forecasting and budgeting;
purchasing beverages and related supplies or requisitioningpurchasing beverages and related supplies or requisitioningpurchasing beverages and related supplies or requisitioningpurchasing beverages and related supplies or requisitioning
them from a corporate commissary;them from a corporate commissary;them from a corporate commissary;them from a corporate commissary;
maintaining records;maintaining records;maintaining records;maintaining records;
carrying out control systems (the manager typically has thecarrying out control systems (the manager typically has thecarrying out control systems (the manager typically has thecarrying out control systems (the manager typically has the
only key to the storeroom);only key to the storeroom);only key to the storeroom);only key to the storeroom);
carrying out control systems (the manager typically has thecarrying out control systems (the manager typically has thecarrying out control systems (the manager typically has thecarrying out control systems (the manager typically has the
only key to the storeroom);only key to the storeroom);only key to the storeroom);only key to the storeroom);
handling cash and payroll;handling cash and payroll;handling cash and payroll;handling cash and payroll;
maintaining quality; andmaintaining quality; andmaintaining quality; andmaintaining quality; and
promoting the enterprise and the merchandisepromoting the enterprise and the merchandisepromoting the enterprise and the merchandisepromoting the enterprise and the merchandise

DeterminingDeterminingDeterminingDetermining
Staff NeedsStaff NeedsStaff NeedsStaff Needs
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Determining Staff Needs
Now that you’ve have learned what is expected of each
major bar-related job, you can adapt the information
by adding more detail about the specifics of your bar.by adding more detail about the specifics of your bar.
For example,
1.1.1.1. will your bartenders be working a service bar or publicwill your bartenders be working a service bar or publicwill your bartenders be working a service bar or publicwill your bartenders be working a service bar or public
bar?bar?bar?bar?
2.2.2.2. Free pour, measured pour, or metered gun?Free pour, measured pour, or metered gun?Free pour, measured pour, or metered gun?Free pour, measured pour, or metered gun?
3.3.3.3. How many minimum drinks per hour must they serve?How many minimum drinks per hour must they serve?How many minimum drinks per hour must they serve?How many minimum drinks per hour must they serve?
3.3.3.3. How many minimum drinks per hour must they serve?How many minimum drinks per hour must they serve?How many minimum drinks per hour must they serve?How many minimum drinks per hour must they serve?
4.4.4.4. What kind of person will maintain your image?What kind of person will maintain your image?What kind of person will maintain your image?What kind of person will maintain your image?
5.5.5.5. This kind of information belongs in theThis kind of information belongs in theThis kind of information belongs in theThis kind of information belongs in the job description,job description,job description,job description, aaaa
written blueprint of what is required in each job.written blueprint of what is required in each job.written blueprint of what is required in each job.written blueprint of what is required in each job.

1111.... Developing Job Descriptions
Skills and aptitudes
Physical characteristics
Health requirements
Physical characteristics
Health requirements
Mental ability and attitude
Age requirements

BARTENDER JOB DESCRIPTIONBARTENDER JOB DESCRIPTIONBARTENDER JOB DESCRIPTIONBARTENDER JOB DESCRIPTION
Description:Description:Description:Description:
Bartenders work behind the bars and in back-of-the-house
areas. They prepare and sell drinks to Cocktail Hostesses andareas. They prepare and sell drinks to Cocktail Hostesses and
customers. They prep their work area with several functions,
measure and prepare drinks according to receipe, and make
cash register transactions.
Bartenders must handle credit card tabs, note spills and
overrings, and address the cash register immediately after
preparing an order. They accept tips, but do not allow tips to
remain on the bar or do not exchange tips or change with cash
remain on the bar or do not exchange tips or change with cash
register monies prior to the end of their shift. Bartenders
perform cleanup and register checkout functions at the end of
their shift. They also stock products and supplies.

They perform “silent selling” and “upselling” techniques and
inform customers of club activities and promotions. They serve
customers by using “experience time” goals and create an
upbeat, friendly environment in their work area. They must
customers by using “experience time” goals and create an
upbeat, friendly environment in their work area. They must
function as a team member with Barbacks, other Bartenders,
and Cocktail Hostesses. They must learn and use alcohol
management techniques and advise the management staff of
intoxicated or unruly customers.
Due to the high level of customer interaction, the Bartender
must perform all duties with great emphasis on cleanliness,
must perform all duties with great emphasis on cleanliness,
personability, professionalism, and service. Bartenders are
strongly encouraged to work up individual “Showtimes”—
complete with costumes—to be performed throughout the
evening with the Programmer.

Functions:Functions:Functions:Functions:
Prepare cocktails per recipe and serve per
specifications.
Prep, clean, and stock work area—before, during, and
specifications.
Prep, clean, and stock work area—before, during, and
after shift.
Accept credit cards, cash, and coupons for products.
Perform cash register functions, and checkout
accurately.
Perform “silent selling” and “upselling” functions.
Monitor customers for intoxication, rowdiness, or need
Monitor customers for intoxication, rowdiness, or need
for drinks.
Have “Showtime” mentality.
Supervisors:Supervisors:Supervisors:Supervisors: Bar Manager and Management Staff.

BARBACK JOB DESCRIPTIONBARBACK JOB DESCRIPTIONBARBACK JOB DESCRIPTIONBARBACK JOB DESCRIPTION
Description:Description:Description:Description:
Barbacks work behind the bar areas and in back-
of-the-house areas. Barbacks support the work
Barbacks work behind the bar areas and in back-
of-the-house areas. Barbacks support the work
of Bartenders by performing tasks of fruit cutting,
juice making, filling of ice bins, removal of trash,
and preparation of “speciality” cocktails. They
have several opening and closing duties involving
product stocking and cleanliness, and assist in
product stocking and cleanliness, and assist in
keeping their work area clean through operating
hours.

Barbacks do not accept tips or money from customers
and do not handle transactions or register functions.
They assist in the preparation of the Liquor Requisition
form and advise the Bar Manager of needed supplies
They assist in the preparation of the Liquor Requisition
form and advise the Bar Manager of needed supplies
and products.
Barbacks only prepare frozen cocktails. They wash
glassware and utensils, and supply the Bartenders with
needed liquor, beer, and supplies. Because of the
extensive customer contact, Barbacks must work with
courtesy, energy, and speed. Barbacks are strongly
courtesy, energy, and speed. Barbacks are strongly
encouraged to work up individual “Showtime”
routines—complete with costumes—to be performed
throughout the evening with the Programmer.

Functions:Functions:Functions:Functions:
Set-up the bars for operation.
Clean and mop the bars during operation and atClean and mop the bars during operation and at
the end of operation.
Stock glassware and product.
Change out condiments and juices for the
Bartenders.
Prepare club “specialty” cocktails.
Prepare club “specialty” cocktails.
Monitor customers for intoxication, rowdiness, or
need for drinks.
Have “Showtime” mentality.

Supervisors:Supervisors:Supervisors:Supervisors:
Bar Manager.
Management Staff.
(Directed by Bartenders during operating hours.)(Directed by Bartenders during operating hours.)
Uniform:Uniform:Uniform:Uniform:
Black work shoes or coaching shoes, black pants, white button-
down oxford shirt (long
sleeve), blue apron, blue bowtie, name tag, three club buttons,
one button of choice, pen,
lighter, and a smile.
Grooming:Grooming:Grooming:Grooming:
Grooming:Grooming:Grooming:Grooming:
“All-American scrubbed-up” look for hair. Clean and neat hair,
nails, and skin. For men, no
beards or earrings.

Training The StaffTraining The StaffTraining The StaffTraining The StaffTraining The StaffTraining The StaffTraining The StaffTraining The Staff
44
Training The StaffTraining The StaffTraining The StaffTraining The StaffTraining The StaffTraining The StaffTraining The StaffTraining The Staff

TRAINING THE STAFF
The first part of the manager’s personnel
responsibility, explaining jobs and assigning
responsibilities, begins right after employees areresponsibilities, begins right after employees are
hired. Every person must learn exactly what is
expected of them

TRAINING THE STAFF
There are at least four good reasons for taking the
time and effort to give employees a basic, all-inclusive
orientation session before they start work:orientation session before they start work:
1.1.1.1. They will be able to work faster and with less confusion.They will be able to work faster and with less confusion.They will be able to work faster and with less confusion.They will be able to work faster and with less confusion.
2.2.2.2. They will feel more confident in their jobs, and this willThey will feel more confident in their jobs, and this willThey will feel more confident in their jobs, and this willThey will feel more confident in their jobs, and this will
be reflected in their attitude toward work and in the waybe reflected in their attitude toward work and in the waybe reflected in their attitude toward work and in the waybe reflected in their attitude toward work and in the way
they relate to your customers.they relate to your customers.they relate to your customers.they relate to your customers.
3.3.3.3. They will more easily establish good relationships withThey will more easily establish good relationships withThey will more easily establish good relationships withThey will more easily establish good relationships with
coworkers.coworkers.coworkers.coworkers.
coworkers.coworkers.coworkers.coworkers.
4.4.4.4. They will be more likely to stay if you ensure that theyThey will be more likely to stay if you ensure that theyThey will be more likely to stay if you ensure that theyThey will be more likely to stay if you ensure that they
have a good experience from the very first day.have a good experience from the very first day.have a good experience from the very first day.have a good experience from the very first day.

Bartender Training
As you might imagine, introducing a new cocktail in
such an establishment is quite a feat and includes the
following steps:
1.1.1.1. Standardizing the drink recipeStandardizing the drink recipeStandardizing the drink recipeStandardizing the drink recipe1.1.1.1. Standardizing the drink recipeStandardizing the drink recipeStandardizing the drink recipeStandardizing the drink recipe
2.2.2.2. Pricing the drinkPricing the drinkPricing the drinkPricing the drink
3.3.3.3. Equipping the bars with ingredients and appliances (ifEquipping the bars with ingredients and appliances (ifEquipping the bars with ingredients and appliances (ifEquipping the bars with ingredients and appliances (if
applicable) to produce the drinkapplicable) to produce the drinkapplicable) to produce the drinkapplicable) to produce the drink
4.4.4.4. Training the bartenders to use the equipment andTraining the bartenders to use the equipment andTraining the bartenders to use the equipment andTraining the bartenders to use the equipment and
ingredients to make the drinkingredients to make the drinkingredients to make the drinkingredients to make the drink
5.5.5.5. Reprinting the cocktail menus and otherwise advertisingReprinting the cocktail menus and otherwise advertisingReprinting the cocktail menus and otherwise advertisingReprinting the cocktail menus and otherwise advertising
the ‘‘new’’ drink concoctionthe ‘‘new’’ drink concoctionthe ‘‘new’’ drink concoctionthe ‘‘new’’ drink concoction
6.6.6.6. Programming the computerized cash registers to trackProgramming the computerized cash registers to trackProgramming the computerized cash registers to trackProgramming the computerized cash registers to track
the ‘‘new’’ drink concoctionthe ‘‘new’’ drink concoctionthe ‘‘new’’ drink concoctionthe ‘‘new’’ drink concoction
6.6.6.6. Programming the computerized cash registers to trackProgramming the computerized cash registers to trackProgramming the computerized cash registers to trackProgramming the computerized cash registers to track
sales of the new drinksales of the new drinksales of the new drinksales of the new drink
7.7.7.7. Familiarizing the servers with the drink, including a tasteFamiliarizing the servers with the drink, including a tasteFamiliarizing the servers with the drink, including a tasteFamiliarizing the servers with the drink, including a taste
of it, so that they can describe and sell itof it, so that they can describe and sell itof it, so that they can describe and sell itof it, so that they can describe and sell it

Sales Training
This kind of training is a combination of the
following:
1.1.1.1. Product knowledgeProduct knowledgeProduct knowledgeProduct knowledge1.1.1.1. Product knowledgeProduct knowledgeProduct knowledgeProduct knowledge
2.2.2.2. Sales skillsSales skillsSales skillsSales skills
3.3.3.3. Guest psychologyGuest psychologyGuest psychologyGuest psychology
4.4.4.4. Rules, etiquette,Rules, etiquette,Rules, etiquette,Rules, etiquette,
and techniqueand techniqueand techniqueand technique

Training in Beverage Laws
The following are three more general ideas on
which beverage laws are based:
1.1.1.1. Alcohol may be served only during the days andAlcohol may be served only during the days andAlcohol may be served only during the days andAlcohol may be served only during the days and1.1.1.1. Alcohol may be served only during the days andAlcohol may be served only during the days andAlcohol may be served only during the days andAlcohol may be served only during the days and
hours established by law in your area.hours established by law in your area.hours established by law in your area.hours established by law in your area.
2.2.2.2. It is against state law everywhere to serveIt is against state law everywhere to serveIt is against state law everywhere to serveIt is against state law everywhere to serve
alcohol to anyone underalcohol to anyone underalcohol to anyone underalcohol to anyone under 20202020
3.3.3.3. It is against the law to serve alcohol to anyoneIt is against the law to serve alcohol to anyoneIt is against the law to serve alcohol to anyoneIt is against the law to serve alcohol to anyone
who is clearly intoxicated.who is clearly intoxicated.who is clearly intoxicated.who is clearly intoxicated.
who is clearly intoxicated.who is clearly intoxicated.who is clearly intoxicated.who is clearly intoxicated.

Training in Beverage Laws
A number of good training programs have been developed to teach bar
managers and servers how to tell when people are drinking too much
and what to do about it. In these courses you can expect to learn how
managers and servers how to tell when people are drinking too much
and what to do about it. In these courses you can expect to learn how
to:
1.1.1.1. Keep track of the number of drinks served to each customer.Keep track of the number of drinks served to each customer.Keep track of the number of drinks served to each customer.Keep track of the number of drinks served to each customer.
2.2.2.2. Recognize behaviors that might indicate increasing intoxication.Recognize behaviors that might indicate increasing intoxication.Recognize behaviors that might indicate increasing intoxication.Recognize behaviors that might indicate increasing intoxication.
3.3.3.3. Understand drink equivalencies (how strong different drinks are).Understand drink equivalencies (how strong different drinks are).Understand drink equivalencies (how strong different drinks are).Understand drink equivalencies (how strong different drinks are).
4.4.4.4. Observe guests’ body types and sizes to determine how many drinksObserve guests’ body types and sizes to determine how many drinksObserve guests’ body types and sizes to determine how many drinksObserve guests’ body types and sizes to determine how many drinks
are ‘‘too many.’’are ‘‘too many.’’are ‘‘too many.’’are ‘‘too many.’’
5.5.5.5. Encourage alternatives to alcohol (snacks, a cup of coffee, dinner).Encourage alternatives to alcohol (snacks, a cup of coffee, dinner).Encourage alternatives to alcohol (snacks, a cup of coffee, dinner).Encourage alternatives to alcohol (snacks, a cup of coffee, dinner).
are ‘‘too many.’’are ‘‘too many.’’are ‘‘too many.’’are ‘‘too many.’’
5.5.5.5. Encourage alternatives to alcohol (snacks, a cup of coffee, dinner).Encourage alternatives to alcohol (snacks, a cup of coffee, dinner).Encourage alternatives to alcohol (snacks, a cup of coffee, dinner).Encourage alternatives to alcohol (snacks, a cup of coffee, dinner).
6.6.6.6. Tactfully but firmly refuse to serve the person who can not handle anyTactfully but firmly refuse to serve the person who can not handle anyTactfully but firmly refuse to serve the person who can not handle anyTactfully but firmly refuse to serve the person who can not handle any
more (‘‘I’m sorry, but I’m not allowed to bring you another drink.’’).more (‘‘I’m sorry, but I’m not allowed to bring you another drink.’’).more (‘‘I’m sorry, but I’m not allowed to bring you another drink.’’).more (‘‘I’m sorry, but I’m not allowed to bring you another drink.’’).

Planning for ProfitPlanning for ProfitPlanning for ProfitPlanning for ProfitPlanning for ProfitPlanning for ProfitPlanning for ProfitPlanning for Profit
51
Planning for ProfitPlanning for ProfitPlanning for ProfitPlanning for ProfitPlanning for ProfitPlanning for ProfitPlanning for ProfitPlanning for Profit

PRICING FOR PROFIT
Profit is the difference been total sales and total
costs. For a bar total sales are the number of
drinks sold multiplied by their selling prices.drinks sold multiplied by their selling prices.
Several factors are involved: the cost of each
drink, the effect of price on demand for the
drink, the contribution of each drink to total
sales, and the effect of the sales mix on profits.

The Demand/Price Relationship
Costs and percentages are not the whole answer
to pricing. Price is only one of two factors in total
sales. The other, as you likely know, is thesales. The other, as you likely know, is the
number of drinks sold. The price affects the
number
The effect of prices on numbers is the elusive
secret of successful pricing—elusive because no
one ever knows precisely what effect a change of
one ever knows precisely what effect a change of
price will have on demand in any given situation.

Coordinating Prices to Maximize Profits
The following price categories may be useful; they should at least
give you a point of departure for your own plan:
1.1.1.1. Highballs.Highballs.Highballs.Highballs. Two prices, one for highballs poured with well
brands and one for those made with call-brand drinks.
1.1.1.1. Highballs.Highballs.Highballs.Highballs. Two prices, one for highballs poured with well
brands and one for those made with call-brand drinks.
Generally highballs make up the lowest price category.
2.2.2.2. Cocktails.Cocktails.Cocktails.Cocktails. Two prices, one for cocktails made with well brands
and one for those made with call brands.
3.3.3.3. Frozen drinks and iceFrozen drinks and iceFrozen drinks and iceFrozen drinks and ice----cream drinks.cream drinks.cream drinks.cream drinks. Two prices, one for well
and one for call brands.
4.4.4.4. AfterAfterAfterAfter----dinner liqueurs and brandies.dinner liqueurs and brandies.dinner liqueurs and brandies.dinner liqueurs and brandies. Two prices, one for
4.4.4.4. AfterAfterAfterAfter----dinner liqueurs and brandies.dinner liqueurs and brandies.dinner liqueurs and brandies.dinner liqueurs and brandies. Two prices, one for
ordinary liqueurs and one for premium liqueurs and French
brandies.
5.5.5.5. Specialty drinks.Specialty drinks.Specialty drinks.Specialty drinks. Two prices, one for well brands and one for
call brands.

ESTABLISHING PRODUCT
CONTROLS
ESTABLISHING PRODUCT
CONTROLS
55
CONTROLSCONTROLS

ESTABLISHING PRODUCT CONTROLS
1111. Standard Drink Size. Standard Drink Size. Standard Drink Size. Standard Drink Size
In the vocabulary of the bar the term drink sizedrink sizedrink sizedrink size
refers to the amount of the prime ingredient
In the vocabulary of the bar the term drink sizedrink sizedrink sizedrink size
refers to the amount of the prime ingredient
used per drink poured, not the size of the
finished drink.
As such if your drink size is 11⁄2 ounces, you will
pour 11⁄2 ounces of the base liquor in each drink,
whatever it is.
pour 11 2 ounces of the base liquor in each drink,
whatever it is.
This is your standard drink size.standard drink size.standard drink size.standard drink size.

2222. Standard Drink Recipe. Standard Drink Recipe. Standard Drink Recipe. Standard Drink Recipe
A recipe that specifies exactly how a given drink
is made at a given bar is known as a
A recipe that specifies exactly how a given drink
is made at a given bar is known as a
standardized recipe
It specifies the exact quantity of each ingredient,
the size glass to be used, and the exact
procedure for preparing the drink.

Standardized RecipeStandardized RecipeStandardized RecipeStandardized Recipe

3333. Standard Glassware. Standard Glassware. Standard Glassware. Standard Glassware
Each standard drink should be served in a
standard glass, a glass of specified size andstandard glass, a glass of specified size and
shape that is used every time that the drink is
poured. The size is the more important feature
since it controls both the quantity of the
ingredients that must fill it and the taste,
When standardizing your glassware choose
whatever size and shape will give each drink the
When standardizing your glassware choose
whatever size and shape will give each drink the
most appeal. This doesn’t mean the glassware
itself has to be special; it means that the drink in
the glass should look appealing.

ESTABLISHING CASHESTABLISHING CASH
60
ESTABLISHING CASH
CONTROLS
ESTABLISHING CASH
CONTROLS

ESTABLISHING CASH CONTROLS
When a customer buys a drink you must have a
way of making sure that the sale is recorded and
that the money finds its way into the cashthat the money finds its way into the cash
register. There are many systems of paying for
drinks.
Whatever system, you need standard procedures
for handling cash and some form of guest check
for the record. You need the record. You want
for the record. You need the record. You want
the cash. Some of your personnel and your
customers might want the cash, too.

1. Fails to ring up sales and pockets the money
2. Overcharges and pockets the difference
3. Shortchanges customer and keeps change
4. Brings in own liquor and sells it (using house mixes and
3. Shortchanges customer and keeps change
4. Brings in own liquor and sells it (using house mixes and
garnishes)
5. Brings in empty bottle, turns it in to storeroom, then
sells from bottle that replaces it and pockets money
6. Short-pours a series of drinks, then sells others from
same bottle, keeping themoney
7. Sells liquor from one bottle without ringing up, then
7. Sells liquor from one bottle without ringing up, then
waters down the remainder to cover theft
8. Substitutes well liquor for call brand, collects for call
brand but rings up well price, keeps the change
9. Smuggles out full bottles

The ServerThe ServerThe ServerThe Server
1. ‘‘Loses’’ guest check after collecting and pockets the
money
2. Reuses guest check and keeps the money2. Reuses guest check and keeps the money
3. Overcharges for drinks and pockets the difference
4. Makes intentional mistakes in totaling guest check and
keeps the overage
5. Intentionally omits items from guest check to increase
tip
tip
6. Changes items and prices on guest check after
customer pays
7. Gives too little change and pockets the balance

The CashierThe CashierThe CashierThe Cashier
1. Gives too little change and pockets the balance
2. Fails to ring up guest check, pockets the money,
and ‘‘loses’’ guest check (blame falls on server)
2. Fails to ring up guest check, pockets the money,
and ‘‘loses’’ guest check (blame falls on server)

The CustomerThe CustomerThe CustomerThe Customer
1. Walks out without paying
2. Sends back drink or wine after half-emptying
glass or bottle
2. Sends back drink or wine after half-emptying
glass or bottle
3. Uses expired credit card
4. Pays with a bad check

The cash-control system that you devise to
forestall all of these little tricks should both
reduce opportunity and pinpoint responsibility.reduce opportunity and pinpoint responsibility.
We suggest the following system:
1. If there is no POS system to generate a
computerized check
2. Direct staff to write all guest checks clearly and
in ink.
in ink.
3. If possible use a precheck method of registering
drinks.

4.4.4.4. The bartender or cashier should ring up the sale,The bartender or cashier should ring up the sale,The bartender or cashier should ring up the sale,The bartender or cashier should ring up the sale,
using the total on the POS terminalusing the total on the POS terminalusing the total on the POS terminalusing the total on the POS terminal
5. Instruct the server to print the amount received5. Instruct the server to print the amount received
from the customer on the bottom of the check.
6. Ring up each check individually when paid, and
close the register drawer aftereach transaction.
7. Give receipts to customers along with their
change
change
8. Allow only one person at a time to operate the
cash register and to be responsible for the cash
in the drawer.

Managing yourManaging yourManaging yourManaging your
Bar BusinessBar BusinessBar BusinessBar Business
68

Creating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business Plan
69
Creating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business Plan

Creating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business Plan
This is the ‘‘resume’’ of your business: an
instrument that shows a seasoned consideration
for all aspects of running it. A good business planfor all aspects of running it. A good business plan
should accomplish three things:
1.1.1.1. It should serve as your basic operating toolIt should serve as your basic operating toolIt should serve as your basic operating toolIt should serve as your basic operating tool
2.2.2.2. It should be useful to communicate exactly whoIt should be useful to communicate exactly whoIt should be useful to communicate exactly whoIt should be useful to communicate exactly who
and what you areand what you areand what you areand what you are
3.3.3.3. It should be useful in obtaining financingIt should be useful in obtaining financingIt should be useful in obtaining financingIt should be useful in obtaining financing
3.3.3.3. It should be useful in obtaining financingIt should be useful in obtaining financingIt should be useful in obtaining financingIt should be useful in obtaining financing

Creating a Business PlanCreating a Business PlanCreating a Business PlanCreating a Business Plan
Most experts suggest that you begin the research for
this endeavor by deciding which beverages you are
going to sell. The raw materials to make these drinks
will take 20 to 25 percent of your gross sales.
going to sell. The raw materials to make these drinks
will take 20 to 25 percent of your gross sales.
Estimating labor costs is the next task and typically the
largest expense of any restaurant or bar. As much as
one-third of your gross sales may be spent on
employees’ wages and benefits. Occupancy costs (rent
or mortgage payment on the space, utilities, and
maintenance) should be limited to 8 percent of annual
gross sales. In addition to startup costs, it is wise to
maintenance) should be limited to 8 percent of annual
gross sales. In addition to startup costs, it is wise to
maintain a cash reserve of 6 months’ operating
expenses.

1. Using the Business Plan
1.1.1.1. Location analysisLocation analysisLocation analysisLocation analysis
2.2.2.2. Competitor analysisCompetitor analysisCompetitor analysisCompetitor analysis
3.3.3.3. SWOT analysisSWOT analysisSWOT analysisSWOT analysis
2.2.2.2. Competitor analysisCompetitor analysisCompetitor analysisCompetitor analysis
3.3.3.3. SWOT analysisSWOT analysisSWOT analysisSWOT analysis
4.4.4.4. Lack of followLack of followLack of followLack of follow----throughthroughthroughthrough
5.5.5.5. Much talk, minimal resourcesMuch talk, minimal resourcesMuch talk, minimal resourcesMuch talk, minimal resources
6.6.6.6. ProcrastinationProcrastinationProcrastinationProcrastination
7.7.7.7. Refining an idea endlesslyRefining an idea endlesslyRefining an idea endlesslyRefining an idea endlessly
7.7.7.7. Refining an idea endlesslyRefining an idea endlesslyRefining an idea endlesslyRefining an idea endlessly
8.8.8.8. Focusing on the buyFocusing on the buyFocusing on the buyFocusing on the buy----inininin
9.9.9.9. Lack of visionLack of visionLack of visionLack of vision

2222.... What Is My Bar Worth?
Bar owners ask this question only occasionally,
such as during a divorce, when making estate
plans, or when mulling over the idea of sellingplans, or when mulling over the idea of selling
the business.
And yet, by asking this basic question on a
semiannual or annual basis, he or she can take
concrete steps to increase the value of the
business.
business.

2222.... What Is My Bar Worth?
Value is a highly subjective concept and you
may hear several other terms in discussions of
what businesses are worth:what businesses are worth:
1.1.1.1. Investment valueInvestment valueInvestment valueInvestment value
2.2.2.2. Liquidation valueLiquidation valueLiquidation valueLiquidation value
3.3.3.3. Intrinsic valueIntrinsic valueIntrinsic valueIntrinsic value

MARKETINGMARKETING
76
MARKETING
BAR BUSINESS
MARKETING
BAR BUSINESS

MARKETING A BAR BUSINESS
Shaping your marketing plan involves the following
three major steps:
1. market segment is a more or less homogeneous subgroup
of the total consumer market; its members have similar
1. market segment is a more or less homogeneous subgroup
of the total consumer market; its members have similar
needs and wants, attitudes, lifestyles, income levels,
purchasing patterns, and so on.
2. Determine which products and services this market
segment wants to buy.
3. After you have defined these two essentials you can take
the third step: Shape everything about your enterprise to
attract customers and sell the product at a profit. In the
the third step: Shape everything about your enterprise to
attract customers and sell the product at a profit. In the
process you can position your enterprise in relation to the
competition by creating an image that will set you apart
from the rest.

1. Positioning Your Business
The PatronThe PatronThe PatronThe Patron
The success of your bar will depend to a large
degree on your ability to know your customers,
The success of your bar will depend to a large
degree on your ability to know your customers,
which does not always mean calling them by
their first names or remembering what they
drink, although those are certainly handy skills.
The overall guest experienceguest experienceguest experienceguest experience is always affected
by how the customer felt walking into the bar in
The overall guest experienceguest experienceguest experienceguest experience is always affected
by how the customer felt walking into the bar in
the first place

The other components of the guest experience
are:
1. The service encounter1. The service encounter
2. The service scape,
3. The product itself
affects the guest
experience.

The CompetitorsThe CompetitorsThe CompetitorsThe Competitors
We have already stressed the importance of
studying your competition—not just other barsstudying your competition—not just other bars
and restaurants in the area, but others anywhere
in your town that might attract similar types of
customers.
Primary competitorsPrimary competitorsPrimary competitorsPrimary competitors are those bars with concepts
similar to yours.
similar to yours.
Secondary competitorsSecondary competitorsSecondary competitorsSecondary competitors are those bars that could
be considered competition simply because they
are located near your proposed site.

Physical AttributesPhysical AttributesPhysical AttributesPhysical Attributes
LocationLocationLocationLocation
Ambiance AttributesAmbiance AttributesAmbiance AttributesAmbiance Attributes
Menus and drink listsMenus and drink listsMenus and drink listsMenus and drink listsLocationLocationLocationLocation
AccessibilityAccessibilityAccessibilityAccessibility
VisibilityVisibilityVisibilityVisibility
AppearanceAppearanceAppearanceAppearance
Menus and drink listsMenus and drink listsMenus and drink listsMenus and drink lists
PricesPricesPricesPrices
FoodserviceFoodserviceFoodserviceFoodservice
Service styleService styleService styleService style
AtmosphereAtmosphereAtmosphereAtmosphere
Special characteristicsSpecial characteristicsSpecial characteristicsSpecial characteristics
Special characteristicsSpecial characteristicsSpecial characteristicsSpecial characteristics

Components of Atmosphere
Your position in the market will be a positive
image in the minds of customers that sets your
enterprise apart. An image is, by definition, aenterprise apart. An image is, by definition, a
subjective impression based on something unique
or memorable about your place. It may come
from a single feature or it may be the customer’s
total experience.
Image is the element that you will emphasize in
Image is the element that you will emphasize in
promotions, advertising, and on-site
merchandising.

By this time you probably have a pretty good
idea of the overall impression you want to create:
the atmosphere, or ambience, of your place.
These words are hard to define but you know
the atmosphere, or ambience, of your place.
These words are hard to define but you know
what they mean.
They have to do with what is seen, heard,
touched, and tasted—the total of sensory
impressions, to which the customer adds a
psychological ingredient of response.
psychological ingredient of response.
Ambience may well be the most influential part of
the customer’s experience and it is likely to make
its impact immediately.

You must address two major components when creating
atmosphere:
((((1111) physical factors and () physical factors and () physical factors and () physical factors and (2222) human factors.) human factors.) human factors.) human factors.((((1111) physical factors and () physical factors and () physical factors and () physical factors and (2222) human factors.) human factors.) human factors.) human factors.
Among the physical factors appearance and comfort are
most important.
Appearance has the most immediate impact, from the
entrance and the interior as a whole, to the lesser
details of uniforms, restrooms, tabletops, glassware, and
matchbook covers.
matchbook covers.
Restrooms deserve special attention; they can cancel
out a previously favorable impression.
The types and quality of food served may also be
considered physical attributes of the bar.

Decor, Comfort, and Service
Using decor to create atmosphere was discussed You might
want to reread that discussion in light of all that you have
learned since.learned since.
Think in terms of your total concept, your individuality, and
your image. The look of your establishment is one of your most
potent marketing tools: It’s the packaging of your product.

Decor creates the first impression; comfort has a
slower but no less significant impact.
Furnishings—part decor, part comfort—can be
chosen to fill both needs.
Furnishings—part decor, part comfort—can be
chosen to fill both needs.
Lighting is also both decor and comfort, and
sometimes a fine line of compromise must be
drawn.
Temperature is not important to the customer
until it is too hot or too cold, then it becomes
Temperature is not important to the customer
until it is too hot or too cold, then it becomes
very important—too cold in front of the
airconditioning vent, too hot without it.

A ventilation system that draws
smoke away and keeps the air
fresh is an essential element offresh is an essential element of
a comfortable bar environment.
Noise level is still another
comfort factor that you can
control according to customer
tastes.
Sight and sound provide the
tastes.
Sight and sound provide the
first impression, but human
encounters provide the second
and most lasting.

Bar Food and Snacks
What you serve says as
much about your bar as
how the room looks.how the room looks.
More and more bars are
replacing chips, popcorn,
and pretzels with ‘‘real
food,’’ and charging for it.
The simple addition of a
bar menu can create a
The simple addition of a
bar menu can create a
completely different
atmosphere.

Bar Food and Snacks
When deciding how extensive the bar menu
should be, take the following factors into
account:account:
1. Understand your limitations
2. Set hours, at least for hot-foodservice
3. Restaurant/bar combinations should function as a
team
4. Be willing to update the menu regularly
4. Be willing to update the menu regularly
5. Merchandise drinks and foods together

MARKETING TOOLS TOMARKETING TOOLS TO
91
MARKETING TOOLS TO
ATTRACT CUSTOMERS
MARKETING TOOLS TO
ATTRACT CUSTOMERS

MARKETING TOOLS TO ATTRACT CUSTOMERS
Word of Mouth
News, Reviews, and Feature Stories
Personal Contacts
News, Reviews, and Feature Stories
Personal Contacts
Promotional Events
Checking Your Progress
Ask forAsk forAsk forAsk for
it Provide a short questionnaireit Provide a short questionnaireit Provide a short questionnaireit Provide a short questionnaire
it Provide a short questionnaireit Provide a short questionnaireit Provide a short questionnaireit Provide a short questionnaire
Hire mystery shoppersHire mystery shoppersHire mystery shoppersHire mystery shoppers
Employee feedbackEmployee feedbackEmployee feedbackEmployee feedback

PRICINGPRICING
93
PRICING
AS A PROMOTIONAL TOOL
PRICING
AS A PROMOTIONAL TOOL

PRICING AS A PROMOTIONAL TOOL
The role of pricing in promotion used to be
viewed in terms of a simple formula:
Reduce a price and you increase demand. TodayReduce a price and you increase demand. Today
most bar owners and managers look at this idea
more soberly (pun intended).

Not too long ago the universal means of applying
the formula was the happy hour, a period of time
in the late afternoon or early evening when all of
the drink prices were reduced, or two drinks
in the late afternoon or early evening when all of
the drink prices were reduced, or two drinks
were offered for the price of one. Now, the
happy hour is against the law in many states.
Many managers sighed with relief since they
generally only broke even during happy hours
and went along with them only to remain
and went along with them only to remain
competitive.
Besides in today’s climate few managers want to
flirt with the risks of the intoxicated customer.

One of these is to make a certain high-profit
drink a ‘‘special of the day’’‘‘special of the day’’‘‘special of the day’’‘‘special of the day’’ by cutting its profit
margin in half.margin in half.
Even the most upscale bars can learn from
quick-service restaurant chains about the
practice of bundling, or packaging two or more
items together and selling them at a fixed price.

PROTECTING AND
EXPANDING
PROTECTING AND
EXPANDING
97
EXPANDING
YOUR CONCEPT
EXPANDING
YOUR CONCEPT

PROTECTING AND EXPANDING YOUR CONCEPT
Protecting Business Identity
Branching Out
As you develop the market position of the first barAs you develop the market position of the first bar
determine whether its appeal may be broader than in your
existing market area: Elsewhere in your city or county?
Could the appeal be statewide, national, or international?
Establish a system to replicate the initial unit’s success.
Determine exactly what is required, and whether you and
your business partners can afford to provide it.
your business partners can afford to provide it.
Ensure that you can deliver the same support—in terms of
both staff members and funds—to the second unit as the
first one enjoys.

Employee and Staff Management for Beverage Businesses

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