Do you know how to stop losing money in your venue? In the hospitality sector, making a profit can sometimes feel as elusive as finding a mythical money tree@  Reflecting on my journey, I’m often struck by the varied ways some staff members, often without realising, deeply affected our financial stability. In an industry where people see money being rung into a till on a hectic shift, it is easy to assume that busy venues are profitable.  Those of us in the trenches know that reality paints a different picture – money really doesn’t grow on trees and profit margins can be extremely tight.

Of course, this story isn’t without its heroes. Many of our staff were stellar – dedicated, loyal, and genuinely invested in our success, often going above and beyond. Even these staff could lose us money through poor pint pulling or getting an order wrong.  However, in an industry known for its transient workforce, we’ve also faced our fair share of deliberate acts, leading to unnecessary financial losses that added up to a pretty penny!

Ten Ways You Can Lose Money Unnecessarily

Mishaps varied from innocent neglect, like not caring for expensive equipment, not turning on outside lights so we looked shut or leaving items out for nimble-fingered patrons, to more intentional criminal acts. These included:

1. Unauthorised Freebies: Nonchalantly giving away drinks or slyly serving themselves.  See this article from the Morning Advertiser on just how big this problem is.

2. Till Tricks: Setting tills to training mode, effectively hiding transactions.

3. Skimming: Not processing drinks on the till and pocketing the cash.

4. Unapproved Early Closures: Locking up the establishment prematurely without consent.

5. Buffet Bandits: Allowing walk-ins to feast from the B&B buffet, then charging them off-menu prices and keeping the cash.

6. Till Tampering: Pocketing surplus cash when the till didn’t balance.

7. Secret Stays: Accepting late, last-minute off-the-book room bookings, pocketing the payments.

8. Fictitious Refunds: Fabricating guest complaints to issue undue ‘refunds’.

9. Cleaning on the Clock: Stretching out housekeeping tasks, we even discovered one staff member napping on the job in our four-poster bedroom.

10. Overzealous Compensations: Exceeding policy guidelines in resolving customer complaints to make their life easier.

One Painful Lesson!

On the last point, one notable episode that sticks with me involved a couple staying in our four-poster bedroom. Our riverside garden and rural location meant we were not immune to nature’s countryside habits. The couple when out for the evening, leaving an open window and switched-on lights in our four-poster bedroom which attracted a few flies – a foreseeable occurrence by the water. Our manager’s response? To refund the entire room cost – a grand gesture far beyond our policy guidelines. This unnecessary generorsity may have avoided conflict for her to deal with, but it shows just how easy it is to lose money without always realising.

These experiences underscored the need for vigilant management. Despite deploying CCTV, implementing stringent till controls, and enforcing training programs, the clever circumvention of rules was a constant battle as staff thought up new ingenious ways to make a fast buck.  

How to Stop Losing Money?

In this industry, embracing technology to help control costs is vital, but so is the realisation that staff misdemeanours aren’t personal affronts. Too heavy-handed approach can squash staff loyalty. Anticipating some level of loss when budgeting, maintaining meticulous records – including wastage, clear policies, controls, and conducting surprise checks are critical. Staff need training and reminding about expectations. Invoking disciplinary procedures is a tool that is often implemented too late.  It’s about finding that delicate balance – holding staff accountable while navigating an industry where, unlike the fictional money tree, profits need careful cultivation, as does staff engagement.

If you need help with tricky staff issues – get in touch and we can help.

Have you come across other deliberate staff acts that you didn’t expect?  Why not comment and let us know what.