Managing Your Draft Beer
Published in PMQ Pizza Magazine, May 2010
In December 1933, the party began again. Prohibition was history. You could not walk into a saloon without hearing the greatest line of all: "this one's on the house!" Now, more than 75 years later, approximately one out of every five draft beers is effectively given the same treatment. Excessive draft beer waste and giveaways behind the bar remain a problem for both social and technological reasons, and many pizzeria operators remain unaware of the losses, don't believe the waitstaff is culpable, or are uncomfortable dealing with potential conflict.
Industry reports indicate that bar theft costs the hospitality industry $4 billion dollars per year. With draft beer shrinkage (unaccountable loss) of 20% being labeled the industry "average," is it safe to assume restaurant owners consider this figure acceptable? It's difficult to think of another industry in which owners would consider one out of five products "missing" as acceptable.
Should you turn a blind eye to this costly fact? Mike Pittman, responsible for running multiple Star Pizza (starpizza.net) locations in Houston, would say no. "Draft beer is a major source of revenue for Star Pizza," he explains. "We implemented a solution to measure draft beer flow and expose unacceptable draft beer shrinkage. In one week, we isolated a problem employee and presented the shrinkage reports, and she quit. Problem solved." Pittman performed his own research and found the solutions available for measuring draft beer shrinkage. "The impact was immediate," he says. "Beer sales increase, hard costs decrease."
Know Your Flow
With today's technology, pizzeria operators have the capability to make 20% shrinkage a thing of the past, not simply acceptable loss. Yes, there is waste associated with pouring draft beer, especially if your system is not operating efficiently. But pouring problems can be fixed. By measuring draft beer flow, you can calculate exactly how much beer is lost to shrinkage. If your system is causing 15% shrinkage, for example, it is simple to calculate the true hard cost loss and determine if fixing the problem is cost-effective.
It's also important to know how many servings you should get from a keg. For example, most owners know there are 1,984 ounces in a 15.5-gallon domestic keg, and they know they pour 16-ounce pints, so they assume 124 servings per keg. However, with the evolution of the 14-ounce pint glass (in combination with 1/2" head), they should expect closer to 155 servings per keg. At $4 per serving, that adds up to $124 per keg is lost revenue! Determining how much you're actually pouring is a vital step to reducing shrinkage.
Since 2001, many new draft beer inventory solutions have arrived in the marketplace. Whether your business pours 20 kegs per night or 20 kegs per year, there is a cost-effective draft beer inventory solution available. For smaller owner/operators, self-installed battery-powered draft beer solutions can be purchased for less than $200 over the Internet and installed in minutes. If a POS-integrated draft beer inventory solution is desirable, there are many solutions available as well.
Surprising Losses
Chris Parker, owner/operator of Jojo's Pizzeria (jojospizza.com) in Chino Hills, California, decided to install draft beer meters on his four kegs. Skeptical about the size of any potential losses, Parker implemented a self-contained draft beer meter he installed in minutes. Without notifying his staff, he decided to establish a benchmark. After his day off, Parker reviewed the draft beer data and noticed a variance of approximately 360 ounces (about six pitchers). Confident that his beer pours well, Parker decided to address the staff. What he learned changed the way he operates his business today.
Parker showed the staff his new draft beer meters on each keg and asked if there was a reason for the missing six pitchers. After 30 seconds of silence, one server admitted she was "very busy and may have forgotten to ring up two or three pitchers." Another server confessed, "Some of my friends were here, so I gave them a pitcher." Last, the cooks admitted they often pour themselves a pitcher "while cleaning up." Parker was shocked. Missing revenue and the additional risk of liability due to employees drinking on the job carried a much greater price tag than Parker was expecting.
However, bartenders and servers do not always cause unacceptable draft beer shrinkage; in many cases, management contributes to or even drives the problem. It's human nature to avoid confrontation, but when draft beer shrinkage data is made available to management and points toward theft, they need to take action and address the problem. This scenario can be difficult, but there are steps that may ease the process.
Tough Conversations
With draft beer monitoring solutions available, the question becomes: How do you implement and enforce solutions without impacting the morale of the staff? Board-certified psychiatrist Randy Ross consulted on a pilot study of more than 20 restaurants with challenges related to draft beer shrinkage. "It's important to be as straightforward and as transparent as possible as these new technologies are presented," Ross advised. "Emphasize to staff the competitive nature of the marketplace and the need for accurate data." Ross also suggested the message to staff should be clear: "You are not the problem, yet you are a key part of the solution."
Nobody likes to be part of a sting operation (suddenly every ounce of draft beer poured was being tracked and nobody knows why). In every pilot study done by Parker Technologies, rumors ran rampant before the staff was formally addressed about a new procedure using draft beer measuring technology. Once the staff was addressed, everyone was at ease-with the exception of the dishonest employees.
What if the person responsible for taking action on unacceptable draft beer shrinkage is good friends with the problem employee? It's important for the owner to be aware of possible conflicts of interest. In some cases, family members of the owners may even cause the problem.
Develop a new draft beer accountability policy that works well for your business, and present it to staff for questions and comments. Get the staff involved. Set team-building goals for reducing draft beer shrinkage, and reward staff for meeting those goals (as you would for other revenue-boosting goals, such as upselling appetizers or desserts).
In touch economic times, pizzeria operators don't have to suffer when it comes to the most profitable commodity they sell: draft beer. You have the ability to increase revenue, reduce hard costs and expose afterhours drinking in order to add immediately to the bottom line.
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Bar and Restaurants Applaud TapMate™ for
Better Inventory Control of Draft Beer
Parker Technologies LLC Delivers a Simple, Self Powered Draft Beer Flow Device
Orange, California – April 30, 2008 – Southern California-based Parker Technologies announced today the general availability of TapMate, a simple but powerful draft beer measurement device, following overwhelming response during its successful one year pilot program. Pilot locations were pleased with TapMate’s results reporting that the device was simple to install and produced immediate results including better inventory control and more attentive bartenders.
“After extensive testing in numerous locations, we’re thrilled with the feedback coming from restaurant and bar owners,” said Sean Massey, partner and chief executive officer of Parker Technologies. “They’re shocked at how simple it is to install the product, they’ve watched it work, and the results are clear to everyone: the impact is immediate.”
Through his participation in the pilot program, Jason Jeralds, owner of Tustin Brewery in Tustin, California, can attest to the value of TapMate and the impact it will have on his restaurant’s bottom line.
“With keg beer, we had no simple way to monitor what was being poured versus what was being paid for,” said Jeralds. “Now when my bartenders want to buy a customer a beer, they’ll ask for approval first rather than having to explain an unacceptable variance later. At under $200 a unit, it’s a no-brainer for places that want to have an immediate impact on their staff and address their shrinkage problems.”
Applebee’s in Palmdale installed TapMate on all eight of their kegs. Linda Legier, general manager, posts reports showing daily and weekly shrinkage in the bar area so that staff knows every beer will be accounted for. She feels this method keeps the staff involved in the process. As a result, she reports that the impact was clear, with servers and bartenders being a lot more aware of what’s going on.
At another test location, franchise owner J.B. Jakubek at Wing Stop Inc. in Costa Mesa, California, agrees that TapMate is a valued addition to his business.
“It’s a great deterrent. Any employee can give away a free beer, and they simply won’t do it if they know you are watching them,” said Jakubek. “Being an owner/operator, I can’t be there all the time, so it’s a great way to keep my employees honest. It was so simple to install, isn’t visible to customers and has had no effect on the beer flow.”
Designed by scientists and engineers at California-based Parker Technologies, TapMate uses an advanced infrared light scheme to measure draft beer flow. Unlike other draft beer metering technologies which rely on moving parts that often fail over time and inevitably disrupt beer flow, TapMate uses light. With the exception of changing a triple A battery, TapMate is virtually maintenance free.
Ease-of-use and an in-house install were top priorities for the TapMate development team. As a result, the device is smaller than a tennis ball and can be installed seamlessly using a single wrench. TapMate attaches directly to any existing keg coupler and does not require any outside contractors or cutting of beer lines. Within minutes of arrival, TapMate provides restaurant or bar owners with complete control of every ounce of draft beer poured.
“Installing TapMate was a piece of cake. Any place that wants to have control over their draft beer inventory needs to take a serious look at this,” said Shawn Flathers, general manager of Joe Josts, a Long Beach tavern that has been pouring draft beer since 1924.
TapMate sells for $195 and can be purchased directly from Parker Technologies via their web site. For more information, visit www.AboutTapeMate.com or call 888-TAP-MATE.
ABOUT PARKER TECHNOLOGIES, LLC
Orange, California-based Parker Technologies is introducing the world to TapMate, a self-contained, tamper proof draft beer flow measuring device. Designed by scientists and engineers from the aerospace industry, TapMate can be self-installed in minutes to any beer keg providing the industry with an immediate tool to address issues of shrinkage. Parker Technologies was founded in 2006.
TapMate™ Draft Beer Flow Device Offers Simple Solution
to Reducing Draft Beer Shrinkage
Parker Technologies Introduces TapMate, a Self-Powered, Self-Contained, Tamperproof Draft Beer Flow Measurement Device
Las Vegas, NV – March 5, 2007 – Orange, California-based Parker Technologies
announced today the debut of TapMate, a revolutionary new draft beer flow device that offers the ideal solution to a problem that has plagued the restaurant industry for decades: draft beer shrinkage.
For years, bar and restaurant owners have been challenged with lost income due to spillage, over-pouring and giveaways. Inability to measure draft beer flow and control costs are critical problems, but solutions cost thousands of dollars to install and maintain.
Parker Technologies’ president, mechanical engineer and former bartender, Sean Massey, developed TapMate with a team of scientists and engineers when he realized similar products existed, but not one provided a simple, accurate and tamper-proof solution that could be installed in minutes.
“Other measurement devices require outside contractors for installation or they come with complicated instruction manuals,” Massey said. “TapMate is user-friendly and can be installed quickly with the aid of a single wrench.”
The TapMate team worked intimately with local restaurant personnel ranging from brew masters of local breweries to upper management of large restaurant chains during the design process. According to Massey, "Owners expressed concern about increased foam caused by beer flow devices, high installation costs, system design complexity, thick instruction manuals, and reliance on technical support. The TapMate design effectively counters every concern that was expressed to us, which is why we went the extra mile and spent three years refining the design. We invented a unique product that applies an advanced infrared detection scheme (patent pending) to measure every ounce of draft beer that leaves the keg.”
TapMate is powered by a user replaceable AAA battery and attaches directly to any existing keg tap. Once installed by loosening, connecting, and tightening one nut, the tamperproof TapMate records every ounce of beer and displays the reading on a resetable or non-resetable LCD totalizer. The totalizer can also be programmed to count backwards to zero denoting an empty keg.
One of the most innovative products the alcohol beverage industry has seen in recent years, the easy-to-install TapMate beer flow meter is smaller than a tennis ball and completely self-contained. For sales information, call Parker Technologies toll free at 877-TAP-MATE or visit www.parker-technologies.com.
ABOUT PARKER TECHNOLOGIES
Orange, California-based Parker Technologies was founded in 2006 by partners Sean Massey, a former bartender turned mechanical engineer and entrepreneur Robert Baeyens, together with the expertise of engineering experts Donald Henderson and Robert Moss. Parker Technologies is introducing the world to TapMate, the world’s first completely self-contained, simple-to-use draft beer flow measuring device.