Scams Behind the Bar — Is Your Restaurant Losing Money on Bartender Baloney?

According to Preventing Internal Theft – A Bar Owner’s Guide, by Robert Plotkin, there are nearly two dozen areas of vulnerability that can be exploited behind the bar. Bartenders can give away free drinks, over-charge or under-charge the clientele, pocket the sales proceeds of unrecorded drinks, substitute well liquor for call brands, under-pour or over-pour liquor portions, reuse drink tickets, or off-set their crimes by altering inventory systems or enter false sales data into the case register or POS.

And bartenders typically work for long stretches of time without direct supervision. Their position requires them to portion inventory, prepare drinks and collect sales proceeds, and they do it all before recording a single detail of the transaction into the POS system. The result is a job laced with opportunities to rip off the house and its clientele.

According to Tracy Finklang, long-time corporate beverage manager for Rock Bottom Restaurants, “Theft will always be an issue behind the bar, in large part because there are so many ways operators can get burned beyond losing cash, including over pouring, under pouring, sliding drinks, not charging for doubles, buying tips, sousing the cocktail waitresses, and bartenders helping themselves to the inventory.”

Sean Finter, CEO of Barmetrix, an international consulting firm that specializes in analyzing product variance issues and management effectiveness, says, “Bars and restaurants have a huge amount of exposure. They typically operate with under paid transient staffs working under difficult circumstances: loud music, odd hours and intoxicated patrons. It is not an environment conducive to tight controls.”

Aidan Demarest, director of spirits and beverages at The Edison in Los Angeles, asserts that bartenders become accustomed to making a certain amount of cash every night and if the cash isn’t walking in the door, they’ll look for it elsewhere.

Demerest also points out that bartenders are usually paid little more than minimum wage, receive no benefits, and typically aren’t even fed during long shifts.

How extensive is this problem?

Working in conjunction with the Sacramento-based California Restaurant Association, the international beverage auditing service, Bevinco, a liquor inventory auditing company, determined that beverage operators on average lose 23 percent of their liquor and draft beer to over-pouring and theft, the combined cost of which is staggering. The very thought is enough to make seasoned managers wince and bar owners shudder.

Here are some recommendations to help address this all-too-common bartender heist:

1. Cultivate loyal bartenders by paying them a decent wage, giving them free food and perhaps even providing health insurance benefits. The Law of Reciprocity will encourage them to watch your back.
2. Use precision-pour devices on your liquor bottles.
3. Install security cameras in the bar.
4. Hire a “secret shopper” service to have drinks at your bar and size up the situation.

And remember, says Plotkin, one of the best ways to disrupt any rouse between cocktail servers and the bartender, is to require them to ‘precheck’ their drink orders into a POS system prior to approaching the bar. The intent behind this system is to eliminate the possibility of employees giving away free drinks, unrecorded sales, overcharging, and undercharging the clientele. The bartender should still be directed to only prepare the drink order that has been ‘prechecked’ with a hard copy in-hand from a remote printer located at the bar.

With 20 years’ experience in merchant services and POS full-service restaurant and tablet systems, we’ve done a ton of research on the many ways restaurant owners are losing profits!

Call 505-296-2847, to start a conversation about how we can help you abate bartender and server theft, or keep you from losing money on profit siphons you may not be even be aware of!