How to be business-savvy in the world of cocktails

How to be business-savvy in the world of cocktails

Tales of the Cocktail conference offers tips for industry professionals

Cocktail professionals, experts and enthusiasts gathered in New Orleans recently for Tales of the Cocktail to learn, sample and mingle.

The list of seminars at the conference, held July 21-25, illustrated growing interest in the cocktail craft with a wide variety of topics, such as the history of various drinks, spirit-specific education and tastings, and technique demonstrations.

However, the first day of seminars was geared specifically toward industry professionals, with panelists providing tips for how to grab a competitive edge in an increasingly cocktail-savvy marketplace.

Click here to view a slide show from Tales of the Cocktail 2010. [3]

Highlights of the professional seminars:

Don’t be average

“Average is crowded. The market is flooded with average business,” Sean Finter, chief executive of Barmetrix, a consulting company dealing with hiring and management education, said during the seminar “Strategic Management: Systems of the Industry’s Best Operators Revealed.”

To become above average, operators need to not only ask guests what they want, but ask them effectively.

According to Finter, guest satisfaction could be distilled down to one, two-part question highlighted in Fred Reichheld's “The Ultimate Question”: On a scale of one to 10, how likely is it for a guest to recommend the venue to someone else, and what was the most important reason for the rating given.

Finter explained that guests pay for three things: product, staff and service. Barmetrix surveyed 920 bars and restaurants that they had worked with and found that profits suffered the most when service was lacking.

Managers need to educate employees about the company’s top priorities as well as their individual priorities to provide the best service possible, he said.

“If you can't communicate the purpose of a person's employment in a single diagram or few sentences then you don't have one,” Finter said. “Tell them what to do. And figure out if they're capable of caring.”

Own your ideas

A seminar, simply titled “Intellectual Property,” asked the question, “Who has a right to my creative work?”

Moderated by mixologist Eben Freeman, who previously worked with WD-50 and Tailor in New York City, the seminar touched on the intricacies of intellectual property law and recourses for those in the bar and beverage industry. Panelists included J. Riley Lagesen and Sheila Fox Morrison of the law firm Davis Wright Tremaine LLP.

Morrison advised bartenders and mixologists to think about who they are giving their recipes to, and what types of recipes they are giving away.

Managers may find that in teaching employees how to make a certain ingredient or mix a certain drink, they’ve given away trade secrets. Along the same lines, employees might not realize until it's too late that they inadvertently gave permission for the free use of their ideas or are restricted in what ideas they can take with them.

While recipes and simple bar practices might be tough to protect, Lagesen suggested that bartenders, mixologists and consultants take their cue from celebrity chefs and the food world.

“Think about yourself as your own brand," Lagesen said. "You are each your individual corporations. If you picture yourself that way, you're all stars when you're behind a bar. You are what is driving business to that bar.”

Lagesen pointed to the example of Wolfgang Puck to illustrate the importance of personal branding in guaranteeing leverage in business negotiations. Puck built his brand around his restaurants, then himself and leveraged himself as a brand into multiple channels.

“There's no difference between Wolfgang Puck and any other restaurant/bar chains. It's all about branding,” Lagesen said.

Make money from your ideas

Another seminar, “The Fine Art of Negotiating a Deal,” also emphasized the importance being business savvy in today’s competitive cocktail market.

J. Riley Lagesen, acted as moderator for a panel that included Audrey Saunders, owner of New York's Pegu Club, Chad Solomon and Christy Pope of the cocktail catering firm Cuff and Buttons and consultants with Liquid Relations, and special guest Ryan Magarian, president of Liquid Relations and co-founder of Aviation Gin.

For those thinking of heading into the consulting field, the panelists cautioned that providing a venue with drinks and ideas can be a complicated process that begins long before the menu is made and doesn't end once the recipes are handed over.

Pope said cocktail professionals interested in consulting should think about development fees.

“Every time you go into a deal, there's X amount of work that you have to do before you get to the deal," she said. "That's part of your intellectual property, your contacts, your time.”

“Your time is valuable and [business partners] need to know this," Magarian said. "Find out what your day rate is going to be...they'll respect you more.”

“Contracts are absolutely critical right now because people don't expect much," he added. "I think we’re vastly underestimated with being able to do business.”

Lagesen said short-term agreements and contractual provisions in consulting agreements in the industry rarely provide sufficient quality control to mixologists working as consultants. This lack of quality control can determine the success or failure of a bar program.

“On the consulting side, in terms of deliverables, moving forward successful consulting is going to be more than just creating a menu,” Solomon said. “It's going to be more of a well-rounded skill set. It's going to have to be profitable and manageable.”

“There's something to be said for what we deserve,” Saunders said. “But there's also something to be said for what we offer and at the end of the day, the client needs to feel like he's getting what he wants.”

For additional images and coverage of Tales of the Cocktail 2010, visit Sonya Moore's blog, Standards and Pours. [4]

Contact Sonya Moore at [email protected]