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Case study - One
Baddiley & Cooper saves busy Hotel over £4k a month.
On an initial stocktake at the hotel in question, the result showed a deficit of £4,448 with a profit margin of 70.6%. Most of the shortfall was through the restaurant.
We immediately put in controls to stem the tide of the losses and performed an unannounced visit during service.
Our visit highlighted many problems including staff training issues, incorrect measures / glasses being used, drinks not being posted onto our bill and excessive wastage in the bar.
We gave advice on how to prevent these things happening and suggested the systems which should be put in place. The hotel management acted directly on our advice and after a couple of months hard work the stocktake results vastly improved.
The stocktake on the third month showed a small surplus of £176 and a GP of 72.9% and these good results have been repeated over subsequent months.
Case study - Two
Restaurant profitability & cash flow turned around by B&C
We were contacted by a restaurant that was experiencing low profitability and a squeeze on cash flow, despite the fact the restaurant was full every lunch and dinner service.
On an initial stocktake at the restaurant, we realised their stock levels were extremely high in relation to turnover. The restaurant was holding 95 days worth of stock, which equated to £45,000. The management had inherited this level of stock and had simply been topping up every week without review.
Once we analysed the figures and set them up par stock levels for each product based on sales, they were able to reduce the stockholding over the ensuing months. Once the par levels had been reached, the stockholding had reduced to 21 days and a value of £10,000 – this left them with an extra £35,000 in the bank and the cash flow problem was solved.
We also investigated the profitability of every product and discovered that there was no pricing strategy in operation. We developed a strategy suitable for their type of business to maximise the total profit made and this saw their margin increase from 68% to 72% over the course of three months. This increase meant a net cash profit gain for the business of around £7,000 per month.
Case study - Three
Pub goes from loss making to profit thanks to B&C
A busy pub asked us for help as they had been consistently making a loss and were having trouble meeting their overheads.
We undertook a thorough stocktaking process and our results showed a very low GP of 42% and a stock deficit of £3,022 in 21 days. After discussion with the owners, we ascertained that nobody was checking deliveries in and in fact they were simply being left by the dray in the back yard. We asked them to be on site when the next delivery was due and to check the stock in carefully. Of the 28 products on the delivery note, 5 were either short delivered or not there at all.
We then conducted a covert visit one evening to find out what was going on during trading hours in the owners absence.
Staff were giving away drinks with no sale through the till and one person was under ringing drinks. Once we had informed the owners of our findings, we set out a plan to stop the losses using simple daily checks.
Once this had been instigated and the offending staff removed, the subsequent stocktakes showed a healthier profit margin of 65% and a small deficit of £35.
Within the matter of a few months the pub was turning a healthy profit again and our constant monitoring of the situation means that this improved profitability will be ongoing and sustainable.