Delivery Cocktails - Are They Right for Your Bar?
Let me preface this article, as I know we are all desperately searching for a straight forward answer to this problem. Something that we never thought in a million years we'd have to deal with in our life time. There's no right way, or wrong way to get through this, there's only "your way." By that I mean the collective "your" of course.
But this is survival, and there's no giant answer to all venues making it through. It's taking a breath, assessing the facts that affect you and your team, putting your heads together, and getting creative with ideas that support your consumer, your industry, and in turn, give them the channel to support you.
In the early stages, when the close down order was imminent, it was tough not to panic. I tried very hard to speak with other bar owners, brand ambassadors & pals in the industry as fast as I could. Firstly, to try to get an idea of where everyone else was at, to help get an idea of where I should be, but above all to show mutual support. Our mindset being we are stronger in numbers, and by getting together and thinking of a way of how we survive this, it helped me feel was on "top" of it, at least as much as I could be.
I was looking a lot to friends in China who had already been going through all of this & how they were surviving. (Hope & Sesame, Proof & Co., Drink Magazine Asia to name a few.) Reading as much as I could, having conversations, mapping out how different styles of venues, in different locations were dealing with the crisis.
They all have great insight and I have continued to follow any information that comes to light. However, the reality is the UK is a very different place than China, we're at different stages, and the everyday infrastructure to support these concepts will mean our version will look very different. It's not simply a copy and paste mechanism.
So, I began making a huge list of all this information to be able to tackle FAM shutting its doors.
Firstly, from a staff point of view, the UK government furlough scheme has definitely helped some, but it does not help all. At FAM Bar we have been able to furlough most of the team, which is positive, though we're still working on how we can support one team member, who doesn't qualify. Not to mention I don't know personally where I stand, as I work as a freelancer and may not be eligible for government assistance. This is important to note because it effects what staff you have at your disposal to implement any revenue concepts, that will help the venue survive.
Speaking daily with the shareholders, we dove straight into getting set up to do a bottled cocktail delivery system. The "go to" scheme for most of the industry that felt logistically feasible. Firstly, we wanted to get on top of this so the team would have work if we had to shut the doors (pre furlough). Each day, the model of the system changed due to everyone trying to figure out the circumstances, and best practice, but feeling time was of the essence, bottles, labels & batching kits were ordered and are currently sitting in my hallway. I reached back out to the community and friends, who have been able to get this system off the ground, assessing who they were using for delivery, looking into all the overall costs both with and without the support of brands.
After a lot of research, a lot of back & forth on ideas over a few weeks, we realized that this was not going to be a viable option for FAM at this time.
Reasons why we are not currently doing delivery cocktails:
- Deliveroo / UberEats have an initial set up cost of £525.
- Deliveroo / UberEats need to come & do a hygiene safety reading for the venue (which of course I understand & agree with, though the wait on this list can take some time).
- Deliveroo / UberEats then take a 35% from each order, dropping the GP on each cocktail significantly. Rough GP's with Deliveroo fees 40% -> 60% *They raised their fees since businesses have had to go into lockdown. I could understand if they voiced that this would be going to drivers during this time, however they have not.
- Using a Courier service like Stuart may be cheaper depending on distance. Though due to high demand they are over extended and you need be patient as to when your delivery will be picked up / delivered. (Rough GP's with Stuart courier fees 50% to 70%.)
- Some bars are using their staff to do the deliveries on bikes, though for us this also would not work. Not only would we be worried about the health & safety of the team, but, being furloughed, they are now not allowed to work.
- The furlough scheme is very strict about being solely for staff who cannot work because of the lockdown. As a small business we need this scheme to keep our employees & continue to pay them. This means that no one can help to do the delivery system.
- This would leave to me to do the delivery system alone. Which at first, I was alright with. But once we break it down to how much it would make for the business, plus the question of logistics, and personal safety. Was it safe for me to be travelling into Central London each day? Being in the venue alone, in a deserted city, and in the end would there be a demand in Central London at this time?
For the potential revenue we could, and that's a big could, bring in, the cons outweighed the pros, and we decided this was not a viable solution for FAM.
However, whilst cocktail delivery is not viable at FAM right now, one silver lining for us, and the industry, is we, along with many other bars, now have the means to do this once the lockdown is over. We know some bars are having great success with delivery, bringing in at least enough cash to help them survive, and I believe this is paving the way for future success. Providing a service that will add a great revenue stream and tap into a high-end style of cocktails at home, that prior to Covid-19 wasn't much of a trend in the UK.
As I write this, the FAM team are all doing well. It's a slow burn, but every day is important, and we will continue to work on ways for the team and venue to survive. Hopefully soon I will be writing again with a reopening list. For now, please look to support your local bars & restaurants if they are able to deliver.
If you are a bar owner and would like to contribute to Bar Entrepreneur Frontline please email me at Simon@DiffordsGuide.com. Thanks to support from Havana Club all published contributions will be paid for, with a matching amount donated to The Drinks Trust charity (formerly The Benevolent), or a local hospitality charity of your choice.