Preparation's key

I am often asked what can be done to make the stocktaking process flow better with minimum disruption to the business and customers. Good preparation is the key and it means that when your stocktaker arrives, he or she should be able to start the stocktake almost immediately. Most stocktakers welcome a cup of coffee prior to starting, and will perhaps carry out a hydrometer check and read the tills whilst they drink it. Be organised and be prepared. Even where a pub is managed, an unannounced stocktake generally should not be an inconvenience. Some people keep their cellar and bars immaculately, but let themselves down by poor record keeping or vice versa. First, the stocktaker will want to count the physical stock ­ so it needs to be tidy. Stock up your bars so that bottles on shelves are uniform and easy to count. When your stocktaker checks the dates on your bottled products, they should find the shortest dates at the front of the shelves and fridges, and the longest dated products at the back. This is basic good practice. In the cellar, the bottled products should be tidy with no mixed stacks of products. Ensure that there are no half-empty cases below the top case. Clear away empty kegs from the full ones. Spirit stores should have all the stock out on the shelves if storage space permits. If your spirit store is untidy or a lot of stock is kept in their cardboard cases, the chances are that you will not notice if someone steals a bottle or two. I know from experience that stock is stored in all sorts of nooks and crannies, so ensure the stocktaker sees all these areas. The paper trail Once the physical count is complete, the stocktaker will want your paperwork. This consists of the delivery notes, invoices, details of any allowances to be made against the stock, details of any promotions or indeed any stock sold at a price different to your normal tariff, details of any stock returned, a period sales report from your tills, and of course, a breakdown of yourrevenue figures. Keep a proper file for delivery notes, and keep liquor and food information separately and preferably in date order. If you need to purchase goods from a cash & carry, get separate invoices for liquor and food products. It can be very time consuming if the stocktaker has to plough through pages of food shopping, for example, in order to find items that you have purchased for the wet stock. Another thing to remember is that the stocktaker needs to be told about anything that will affect the end result. If you donate a bottle as a prize, tell the stocktaker, if you sell off short-dated stock cheaply, tell the stocktaker. If you alter any selling prices during the period, tell them the exact date you altered them and by how much. Your stocktaker is not a mind reader so help him to make your results accurate. Lastly, make yourself available to the stocktaker whilst he or she is on your premises. There will always be queries and questions to be answered, so if you have to go out, tell the stocktaker how long you will be gone so that they are not left waiting to complete your stock result. Good preparation will inevitably mean that your stocktaker has more time at the end of the stocktake to discuss your results with you and to offer advice and make recommendations. It is in your own interest, so be prepared. The number game QAs managing director of a small (but ambitious) pub group, I would like to know why the licensed trade measures its loss at selling price, when in reality the only true loss is the cost price ie, what I have paid for it. I have an extensive business background and have not seen this style of measurement before. Can you explain why we do this? AYou are wrong to assume that the only true loss is at cost price, and to you. Because the nature of our business is numerous small cash transactions, there is a very real danger of cash being stolen. If someone steals a jumper from M&S then obviously the cost to M&S is only what they paid for that jumper. If someone steals £10 out of your till, then you have lost not only the cost value you paid out for, but any profit as well, and in addition the Govern-ment has lost £1.41 which represents the VAT element. This is why the VAT inspector issometimes interested when licensedbusinesses are persistently in deficit. They will want to claim the VAT element of such deficits, unless you can categorically prove the deficit is due to stock being stolen or wasted instead of cash taken out of the business. Reason enough to employ a professional stocktaker? Family troubles QI operate a small pub with only two staff, plus my family who help out at weekends. My stocktaker tells me that I have repeated shortages of more than 5%. I am confident my staff and family are not stealing, what else can be going wrong? AIn the entertainment business they say avoid working with animals, children and Van Morrison. In the hospitality trade perhaps they should include family as something to avoid. This is a harsh thing to say, I know, but the trouble with family, and in particular children, is often they do not realise that when they help themselves to a bag of crisps or nuts or a drink without paying, it amounts to stealing. Every time a family member takessomething without paying, it deprives Customs & Excise of the VAT due on it. Presumably you are registered for VAT and will already have claimed back this element, so it is not unreasonable for the VAT man to expect his share if you consume it yourself. Also, if the two staff that you employ see your family take stock without paying, then what's to stop them doing the same when you are not around? These things eat into your profit and could account for a sizeable chunk of your 5% deficits. Treat your family the same way you treat your staff, always pay for any drinks or snacks, and never put anyone above suspicion, particularly when results are as poor as this.