Can Technology Overhaul Your Bottom Line?November 22, 2011 By: Robert Plotkin
The age of information has finally arrived behind the bar, and for many on-premise operators it comes just in time. The need for accurate data has never been greater. Until now, compiling detailed information about what transpires behind the bar has been a time-consuming and labor-intensive process. However, computer-chip technology is now primed and ready to wrench order out of chaos, changing forever the way the bar business does business.
In some cases, technological advances solve one problem by creating a more complex and expensive one. Other times, a new device or system can increase profitability, leaving you wondering how you ever operated the business without it. Here are a few innovative systems designed for use in restaurants, nightclubs and bars that merit a closer look:
The most established of the new technologies is Accubar. Their inventory-control technology uses barcode-scanning handhelds to identify the UPC barcodes on the labels of every product in the inventory. That encrypted information is downloaded wirelessly to the back-end software and a powerful web-based database.
“AccuBar has thrived on the belief that you almost can’t do inventory often enough,” says Dave Grimm, a founding partner in the company. “The more often you count your stock, spot-check your staff and track your losses, the smaller those losses will become.”
Barcode-scanning is the go-to method for fast, accurate inventory tracking. AccuBar delivers a full suite of reports that drive loss prevention, cost controls, just-in-time ordering and staff accountability. After 10 years in operation, AccuBar has been proven effective in operations ranging from neighborhood bars and resorts with multiple outlets to the upscale restaurants featuring expansive wine cellars.
If it’s true that knowledge is power, then Bevinco constitutes a considerable asset. The company is an independent auditing service. Armed with a laptop and electronic scale, a Bevinco auditor is capable of generating management reports that provide detailed depletion information for each product. The reports also analyze each product’s actual sales and profits, then compare those figures with their respective optimum figures.
John Hennessey has owned and operated the Bevinco franchise for Arizona since 1996 and spent every day since behind bars.
“Corporations, the military and even Congress have auditors with independent oversight,” he says. “That’s my function. I weigh the kegs, open bottles of liquor and count every bottle of beer and wine. I let owners know exactly what’s happening behind their bar right down to the last shot. I’m like a walking CAT scan.”
Leveling the Playing Field
Beverage Metrics has taken an entirely different approach to eliminating operational pitfalls. Their monitoring technology uses radio-frequency-identification devices (RFID) attached to the neck of every bottle of liquor in the inventory. The wireless, Internet-based system is then able to track each individual product from the point of delivery through its life cycle behind the bar. The small, tamper-proof RFID tags also determine the exact amount of every pour by analyzing how long the bottle was inverted and precisely at what angle it was held. Following the capture of the pour data, the software automatically reconciles with the POS, matching the depletion information to register receipts.
According to Beverage Metrics CEO Alain Piallat, the wireless technology system can identify variances between actual cost and potential costs.
“The system produces customized reports and trend charts to reveal what’s actually happening behind each of your bars,” he says. “Beverage Metrics can show you exactly what your pour costs are with hard data gathered through the monitoring of your beverage service.”
Operators with an iOS device — iPhone, iPod Touch or iPad — may want to consider using the BarkeepApp to produce basic cost-analysis reports, which in turn are generated on Excel spreadsheets. The device’s built-in camera is used to scan barcodes. The app allows you to track inventory at multiple locations, including receiving, transfers between locations, waste and empties. Information about partial bottles can be recorded two ways — by entering a decimal quantity or weighing partial bottles.
Tim Eicher developed the app to operate the way that a bar manager thinks. “I opened a bar after 15 years working for Oracle as a software architect. I quickly realized that I had to do something to better manage our pour costs. Finally, the geek in me took over, and I decided to build a better solution. I looked to create a system that was highly accessible, easy to use, fast and affordable. I spend a lot of time working with my own bar managers to optimize the product and add features to make the job easier.”
The BarkeepApp is $40 and can be installed on any number of devices.
Toronto-based Freepour Controls offers operators several technological solutions to better manage their inventory. Scanchecker is a hand-held device capable of scanning barcodes and weighing 10 bottles per minute. The data then is downloaded to software that calculates theoretical usage and compares it to actual usage to derive brand and category variances. The system’s versatility affords operators the option to spot-check only the well bottles or any number of “hot items” that typically have large variances. Likewise, Scanchecker easily accommodates daily or station-specific audits.
Losses on draft beer industry-wide run about 20%. Part of the explanation is that it’s challenging to monitor actual depletion. Draftchecker utilizes flow sensors in the beer lines to accurately measure draft beer usage in real time. The proprietary software highlights any discrepancy between poured and sold ounces. Even if draft beer constitutes as little as 10% of your sales, the system can pay for itself in a matter of months.
Running a bar requires making a significant investment in inventory, liquid assets that can disappear at an alarming rate. In fact, inventory levels change with every flick of the bartenders’ wrists. Recent advancements in technology have made it easier and less time-consuming to protect working capital and ensure that you’re realizing the necessary return on that investment.