Making your pub pay
EKW were first formed in 1935 by an American oil field manager, who introduced a new accounting system, enabling petrol station and convenience store owners to manage their accounts more effectively without the need for any specialist accountancy knowledge.
The system has had 65 years of continuous development and today is in use around the world, giving small business operators access to information that most major organisations take for granted, without the time or expense of generating it internally.
A few years ago EKW bought Austens, the accounting firm that specialises in accountancy for pubs, bars and restaurants. EKW is also well known for producing high quality software using the latest development tools, so that business owners can manage their accounts easily without too much messy paperwork, and without all the headaches.
As we have many pubs, bars and restaurants on Phuket, the following - from one of Austens' publications - may be of use for our readers in those businesses.
As a publican you do all you can to maximise your turnover. You achieve this through a combination of service, facilities, product and price. Once you have the customers in your pub spending money, it is vital that you have the right cash control procedures in place to ensure that you get and keep all the money they spend.
There are steps that you can take to avoid the tell-tale signs of something going wrong:
Customers arguing over their change
Cash in the till not agreeing with the till readings
Notes in the wrong sections of the till drawer
Arguments between the bar and the kitchen over orders
Bad stock results
Falling gross profit margins
This does not mean that you have to believe that every member of staff or every customer is out to cheat you. But what is does mean is that through having the right controls publicly in place you can largely avoid errors and also deter problems arising. The key is to think ahead, train your staff and exercise your own rules yourself - set the right example to staff and customers.
Every pub needs the right controls, and they fall into six sections:
Your own discipline
We will not waste time thinking about what to do when you start seeing signs that your cash is under threat, instead we will address the steps to take to avoid the problems arising with your staff in the first place. We want to avoid the suspicion, the lack of trust, and the witch-hunt that inevitably ensues - the need to catch someone, and then the worry if you don't, or the fear about whether you've caught the right one or the only one "at it".
These episodes also damage your relationship with the remaining staff who resent having been under suspicion. Every employer has been fooled over the years, but the first line of defence remains the interview. New employees need to get on with you, your staff and the customers.
It is worthwhile asking them simple but revealing questions such as "When was the last time you did something that you knew was wrong?" Ask for and take up references. Half an hour spent now prior to offering someone a job may save many hours of extra work and worry later.
Establish a house rule concerning tips and ensure that all staff understands them. Satisfy yourself that the rules are fair because envy and a feeling of being unfairly treated over tips can be the breeding ground for theft. Remember that the staff needs to manage the tips themselves to avoid the responsibility for income tax or national insurance.
Also establish the house rules covering the handling of cash at the tills and again ensure that all the staff knows them. In a perfect world, this would be displayed on the notice board and signed by staff as they join you.
To avoid problems arising, it is essential to establish a set of house rules to cover cash handling and to ensure that all members of staff fully understand and have signed off the rules. The first rule must be to insist that staff have no money in their pockets at any time during their shift. If they start with no money they end with no money - especially if you have the correct tips policy in place.
The next rule is to cover receipt of cash from the customer, to avoid any disagreements over the size of the note. Tills that provide the facility for "amount tendered" are a clear advantage here. They record the amount received and calculate the change to avoid any possibility of error.
Staff should always place the note on top of the till, only placing the note in the correct section of the cash drawer just prior to giving the customer the change. This keeps the note tendered fresh in the mind and shows the customer the care being taken to ensure the correct change is given.
As the change is handed back to the customer the staff should say "from your five.." or "the change from your ten is .". If staff can settle into this routine it becomes second nature, reassuring both them and the customer. If a customer does query his change, "linked to the size of note tendered", always offer to cash up the till and conduct a cash check.
While this is inconvenient, it can be done quickly and gives an immediate answer to the query. It also avoids any "scene" with the customer that might impact on other customers.