Wondering if one of your bartenders is stealing is an uncomfortable position to be in.
Nobody wants to accuse anyone of theft, especially someone you may personally get along with. Especially if you’re not 100% sure that’s what’s happening.
That’s why managers and owners must be familiar with three things:
- How to identify variance
- Why Inventory varies
- The ways employees steal
Below you’ll find why variance occurs at bars and how to identify it. Then we’ll get into how it’s likely happening if the cause of that variance is a bartender stealing. You don't want to waste a bartender salary on someone you can't trust.
How to Identify Inventory Discrepancy
Hands down, the easiest way to uncover inventory shrinkage is using bar inventory software like BinWise Pro. It’s a perpetual inventory system that keeps accurate, real-time tabs on all your inventory as you buy and sell it.
By integrating seamlessly into bar POS systems, it has access to all your sales data. That means you get accurate, up-to-date variance reports at the click of a button.
Why Inventory Varies
It’s inevitable that a bar’s inventory does not match its POS sales data. There is no bar on earth that runs a zero-variance operation.
The most common causes are:
- Approved comps
- Spillage or breakage
- Accidental overpouring (make sure your bartenders know what does one part mean)
- Entering items into the POS incorrectly
- Inaccuracy inventory counts
- Employee theft
So, when you notice a discrepancy between inventory and sales, there’s no need to jump to conclusions. Often training staff on standard pours and the creating a bar operations manual and bar staff training manual go a long way toward improving your numbers.
Another quick-fix is automating beverage inventory. That solves any discrepancy issues around inaccurate inventory counts.
But if automation and training don’t solve the problem, you may have a liquor thief on your hands. Here’s how it’s likely happening.
Internal Theft vs External Theft
First, let’s clear something up, there's a big difference between internal theft vs. external theft. External theft is when a customer or other outside person enters your establishment and steals your products. Though a problem, this type of theft is less common and easier to identify as the guest must act in an unusual manner or access parts of your bar that they otherwise wouldn't.
With internal theft, we're talking about employees stealing instead of guests. This type of theft is much more common and can be difficult to uncover. Usually, the first sign of internal theft is an increase in your inventory variance. That's why it's vital to keep track of your inventory and use a perpetual inventory system if possible.
Liquor Theft: 14 Ways Bartenders May Be Stealing Alcohol
With the differences between internal and external theft out of the way, let's look at a common internal issue: alcohol theft by bartenders.
Here are the 14 most common ways bartenders steal or cause inventory shrinkage:
- Ringing up a custom, underpriced drink in the POS and pocketing the difference
- Overpouring for friends, family, authorities, or local merchants
- Buying and bringing their own liquor from home and using that to pour drinks, not ringing anything up and pocketing the money
- Flagging a check as a walk-out and keeping the money
- Unsanctioned comps, AKA free drinks
- Claiming a drink was sent back by the guest, then reselling it and keeping the money
- Ringing up well drinks (see what is a well drink) but giving away top-shelf liquor
- Ringing up top-shelf liquor but giving away well drinks and keeping the difference
- Short pouring certain liquors to make up for the increase in pour cost from theft
- Ringing up drinks on another bartender’s open POS login
- Ringing up a bottle of wine, but serving wine by the glass and pocketing the difference
- Failure to ring in cocktail server sales and pocketing the money
- Short pouring by a half ounce, then pocketing the money for every fourth or so drink
- Selling wine bottle left-overs to other customers as wine by the glass and not ringing it in
Pretty creative stuff.
Bar Theft Prevention and Liquor Security
There are, thankfully, measures bar managers can take to increase liquor security.
Hire the Right People
You can try your best to control for potential problem employees during the bar staff hiring process. Actually check references, run background checks, and use personality tests in addition to tough bartender interview questions. Just because it’s a bartender position doesn’t mean you should be any less rigorous than any other employer. It’s the health of your business we’re talking about, after all.
Find the people who put the time in to learn how to become a bartender. Whether that means they went to bartending school, got a bartending license, or spend hours poring over the best bartending books. That means they’re committed professionals.
Employees are much less likely to steal if they think they’re being watched or management keeps a close eye on the books.
- Install a camera behind the bar
- Tell your bartenders you just got a new bar inventory management system called BinWise Pro and you’ll be doing variance reporting and analysis
- Be up front about policies like comps and pour volume
- Monitor bar operations for a few minutes every hour
To sum it up, be visible! If you’re visible and your employees know you’re keeping an eye on the policies and numbers, they’ll be less likely to act.
Use Secure Rooms
All your bar inventory should be stored in a secure room. Access to that room should be given to bar managers and a few trusted bartenders.
Likewise, employee personal belongings should be put in a secure room at the start of their shifts. Allowing bartenders to keep bags and backpacks behind the bar during a shift is a risk.
Use a Bar Incident Log Book
A bar incident log book is a tool for staff-to-staff communication. It’s a place for bar staff to log any events that a manager or staff member may benefit from knowing about.
Like a guest coming in, getting drunk, and falling off their bar stool. That’s something a manager should be aware of. It should be but in the bar incident log book. That person could lodge a complaint or bring a lawsuit. Neither of which should catch a manager off guard.
It doesn’t directly impact inventory or theft risk. What it does is provide context that may help you make sense of daily numbers if need be. Let’s say a guest was extremely unhappy and demanded 4 remakes of a cocktail. If that was logged, it would shed some light on inventory numbers that day or week.
Take Inventory Often
Inventory should be taken as often as possible. If you’re taking inventory manually, then shoot for every week. Every few weeks is still okay. Every month is tolerable. Beyond that, you’re putting yourself at a big disadvantage. You should also take the time to create a bar supplies list.
The more often you take inventory, the closer you can get to determining when and where inventory discrepancies arise.
What you should actually be doing is using bar inventory software. It eliminates all manual counting and entry errors by automatically adjusting inventory levels with every purchase and every sale. You can even track different beer keg sizing and won't need to Google how many ounces in a pint anymore.
With a system like that, you could look at variance very closely. Not by weeks, but by days and shifts. Because your system will be updating its inventory metrics after every transaction. If you think you’ve got a ne’er-do-well behind the bar, that’s how you’d spot them. It will also help ensure you keep your restaurant chart of accounts accurate.
Putting solutions like that in place will be in any bar manager guide. It’s just how to be a good bar manager. You should also make sure to send your best employees to alcohol server training so you can increase drink sales without hiring more bartenders.