Understanding “Sales” 

“Selling” is an essential part of your pub’s success and the processes you and your staff employ as your pub’s sales force has great impact on your revenue streams and profitability. In order to succeed in the area of “sales” you need to be productive, which as with any area of your pub business,  means getting the greatest return for the least cost.

Sales are a much harder area to get right than, say, production processes such as serving behind the bar or cooking in the kitchen as they involve the attitudes, beliefs and opinions of your team and your customers.

You can run the most efficient and productive pub business in the land but if you don’t get the mix of skills, strategy and systems  for selling just right you’ll find it very hard to make a success of your pub.

In my experience the common problems any publican face are:

  • Winning new business and winning the right type of business for one’s pub
  • Accurately predicting sales
  • Increasing Margins
  • Getting better value from one’s existing customer relationships

 

“I’m just not winning enough new business or the right type of business”

It’s a common complaint that pubs just aren’t creating enough new custom and just as common is the lack of selling skills within the pub team. Sometimes it’s to do with a pub’s offering being uncompetitive, however, much of the time it’s to do with inadequate allocation of sales tasks to staff.

A successful publican will provide guidance for their team and impart the importance of selling whilst carrying out their customer service roles and actually doing the job of tending bar or waiting on tables. A good bench mark would be to get one’s team to try and spend 2/3 of their time in conversations with customers on selling and 1/3 on their customer service banter. Take the time to observe what your team does to sell your products and services and take a good look at what you do to promote sales for your pub. Do you pass the 2/3 test?

“How can I forecast sales?”

This is perhaps the most difficult thing of all to do, irrespective of what type of business you conduct, but without effective supervision of your staff in their selling activities and a clear sales strategy for them to follow you will find it well nigh impossible. If you train your staff to sell as well as serve you will stand more of a chance of predicting future sales. Historic activity in terms of promotions and events at the pub will give you some clues on which to build a sales forecast but monitoring what effect sales patter has on sales has to be one of your goals, and if you’re not already doing this then you should start.

One way of doing this is to offer an incentive for staff, say for instance, on selling desserts with every main meal, run a weekly competition to sell the most puddings and reward the winner. You’ll be surprised how effective this can be in increasing overall sales and once mastered you can use it to predict how other promotions or sales drives might translate into future sales.

“How can effective selling help improve my margin?”

With increased pressure on margins through food, rent, energy, tax and drink cost inflation it’s getting harder and harder to maintain existing margins, let alone improve them. For the effective publican who controls all their costs to the last penny, selling the value of your pub and products is the second most powerful way to boost margins. For instance if you are going to take advantage of supplier deals such as BOGOFs, then passing some of your increased margin on to your customers through a deal for them that increases footfall and sales will improve your overall profitability.

New research from CGA Strategy (March 2013) shows that 86% of of drink consumers are ‘very receptive’ to bartender recommendations.  Appropriate and well-timed advocacy is commonly found behind the bar, but it is not used enough in the dining area.  Certainly, this is best practice in the very highest quality outlets but significant value could be unlocked if more mainstream pubs adopt this process.  As an example, if the average food pub up-sold 1 in 10 rump steaks to sirloin, then it would result in increased sales of £93 per month or an extra £1,116 per outlet per year.  Not to be sniffed at for asking a question.

“How can I get more value out of existing customers?”

The best way to get more value out of your current clientele is to know what they buy, why they buy it and what motivates them to buy more. If you have this understanding of what keeps them coming back to your pub you can target offers and promotions at them which will bring increased sales for you. Key to this targeting is your sales team i.e. you and your staff. There’s no use trying to sell products or services to customers who are unlikely to buy them, for instance old Stan who comes in for a pint of mild every lunch time is unlikely to buy your high margin cocktails so why spend time trying to sell him one. It’s far better to try and sell your party package to that group of office workers who pop in for the occasional lunch or after work drink as they are more likely to take you up on your offering.

In big business this is referred to as “partnership” selling and is perceived to be one of the most cost effective and high return strategies available. You probably do some of this already with things such as real ale, by offering tasters and deals on your real ales you become a trusted “advisor” to your cask ale customers through the recommendations you make. This translates into increased sales by their perception that your service is more valuable than that of another pub where they visit (and feel less valued as a customer than at your pub). Other ways to build up this partnership might be by food and drink matching for instance this wine with that dish or that ale with this daily special.

Train to Gain

You have to train your staff into selling your products and services in order to make a success of your pub. The foundation for this training has to be their belief in the value and quality of your offering and their commitment to making the pub a success. You have to inculcate that belief and commitment by letting them know how you feel about your pub and how important they are to the success of the pub.

For this to be effective they need to be “engaged” in your enterprise which is discussed in my separate article on “Q12 – How Engaging With Your Staff Will Help You Build A More Successful Pub Business”

Back to General Advice