Thinking of buying a tavern

[bartoad]

Greetings everyone. Glad to have found this site. I will retire from a management job in three years and I'm considering buying this little neighbourhood tavern across from where I live as a retirement project. The bar is owned by a 70 year old widow who has been in business for 30 some years and now wishes to offload the property. The place is not very big, maybe 50 chairs or so. It's your typical corner pub with an established clientel. The numbers seem to make sense, 340K in annual sales and 250K in expenses. There is already an experienced staff in place. I would be keeping the same staff. This is where my questions lies. I have worked in retail before, though not in the bar business. There is no cash register at this business. Staff serve beer and wine and are paid in cash. At the end of the day the manager tallies up the sales, keeps the tips and gives the cash difference to the owner. This same manager does the orders and controls inventory. My question is how can this manager screw me. I could reconcile sales to orders weekly, since I will be paying the invoices, therefore making sure that what goes in and out is accounted for. There is no food at this bar. Just beer and wine in a locked cooler which only the manager and myself have access to. What do you think.

[Jallen0]

How can the existing manager screw you? I stopped after rapidly getting to 1000 ways.

Really, there are so many issues with having the same person "do it all". Also, having an accurate inventory system is a key point. Use a different person to receive new inventory than the person serving inventory. A POS system will help you with that and set limits as well.

Check out the forums here, read some posts, and you'll start seeing some ideas. And remember, control systems are only there to help keep honest people honest. The thieves don't care about control systems.

[Oxrock]

I've heard of something similar to this. Where the servers keep their own "cash". Example:
Bartender "A" arrives for the day shift with $250 mixed cash of his/her own money. At the end of the shift, he/she has $500.00 cash. Tally's his/her sales and sees $200.00. She/he pays the bar $200.00 and the rest is tips. Walks out with $450.00.

(Simplified for my simple mind)

[teenclub]

I've heard of something similar to this. Where the servers keep their own "cash". Example:
Bartender "A" arrives for the day shift with $250 mixed cash of his/her own money. At the end of the shift, he/she has $500.00 cash. Tally's his/her sales and sees $200.00. She/he pays the bar $200.00 and the rest is tips. Walks out with $450.00.

(Simplified for my simple mind)

besides the MANY problems with this system...i think your math is off also

if they start with 250 and at the end of the night have 500

They take 200 from 500 to give to the bar, leaving 300

meaning they made 50 bucks.


I guess in a small town, where its impossible to disappear cuz I know where you, your mom, your uncle and your cousin live....it would work...in a city...man, this is just screaming ROB ME ROB ME!

[intensity]

The expense side seems a little high for a mom and pop place with 50 seats and no food. You could really streamline the expense side and get a cash register and improve your income-expense margin by quite a bit.

I can almost gaurantee that the business is losing money due to theft already. In a system with no accountability even honest people find ways to justify "bending" the rules. "Keeping honest people honest" isn't just a cliche' it's a rule of life.

[Michael Black]

besides the MANY problems with this system...i think your math is off also - Teen


Thanks for verifying the math mistake. I kept scratching my head, thinking I drank 1 too many scotch:)

[ministry]

but what if a train left chicago at 10pm and a bus left miami at 3am and they drove the car to the store to get beer. then the train stopped in ohio for 2 hours. who is driving the bus ?



seriosly, get a register. also go sit at the corner of the bar one night and watch the bartenders to see what they do.

[gknoob]

ummmm....the bus driver

[Oxrock]

They take 200 from 500 to give to the bar, leaving 300

meaning they made 50 bucks.



hmmm oops u r correct :o

I wish I could remember where I saw that...Oh well, didn't like that ideqa anyway.

[bartoad]

Thanks for all the feedback. The owner has told me she would be giving me her latest sales numbers for the last fiscal year. I will make up my mind after seeing those numbers. I can't help but think that this manager would be nuts to screw me. He has lived in our small town all his life. He has a wife and two young kids and knows that his reputation would be finished in our small town if he was caught ripping me off. His dad picks up supplies for the bar and his mother is the cleaning lady. I would hate to loose this guy because he basically runs everything. All I have to do is pick up the deposits. Ever since I have had my eye on the place, I see him arrive at 7:30 every morning and leave no earlier than 4:00 before the evening staff arrive.
The bar has four legal video poker machines which he empties every day. He can't screw me on those since in Canada these machines are all connected on a government internet network and every transaction is accounted for. As soon as you open a machine the government knows it centrally.
The only place I figure I can get screwed is to have sales unaccounted for. But if I compare my weekly wholesale beer purchases, say 3000.00$ for 1500 bottles of beer (unit cost is 2.00$ a beer wholesale)and then compare this to my weekly retail beer sales for the same period, say 4500.00$ (roughly 50% markup on cost), I know I will have sold my last inventory and all was accounted for. If I don't have 4500.00 I check my cooler for the difference. If the inventory is missing, the bugger is ripping me off. I I were to work in this bar fulltime there would be no problem, but like I said, I am only retiring from my management job in three years so I need this guy there during the day to run the place. I will continue to go to the bar and check this guy out before taking any decisions. Ahhh innocence is indeed bliss.

[Flatlander]

He could also bring his own booze in, sell it and keep the profit.
You lose the profit on those sales.
It all seems a bit incestous to me and what happens if that guy gets sick, leaves or has to be fired. Who can step in then?

[bartoad]

Yes indeed. I once caught a guy doing that at my brothers bar a few years back. It was a liquor bar and this idiot bartender brought in three liquor bottles which he was selling to friends. Unfortunatly for him I happended to be sitting at his bar. He didn't know I was the owners brother.
Your second point is very good and one I have been considering for awhile. I am totally screwed if this guy decides to take off. I am not about to leave my own daytime job to replace him. Not until I retire in three years anyway. In the event that he gets hit by a bus I was actually thinking of taking out a life insurance policy on his life, paid for by me in the amount of my loan from the bank. At least if I had to cary out interviews and close the bar, my debts would be covered.

[globalstick]

Hey, I also want to have a tavern. It should be beautiful, quiet with light music. People can chat with each other here or to be alone with some thinking. But it's just my dream for future. Hope you can get it. And I suggest you prepare some food in your tavern, like chocolate, cheese cake, and some cooked meat. It beseem drinking. :p
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