If you read my stuff you are probably familiar with the phrase, “Hospitality is a game of inches.” Yes, it’s true. There is the driving engine of room revenue but almost everything else we need to deal with puts a drag on performance. These things can really slow us down, to use another motorsports analogy. One thing you want to make sure you’re on top of is the proper use of the container inventory, and I am willing to bet most of you reading this that you don’t do what I am about to outline.
Before I get into the details, allow me to tell you a little story about one hotel I worked in and the night watchman. I have written another story about Norman the night watchman and you can find it here, it’s a kinda “hotel ghost story.” This one is about another guy and another hotel and I’ll call him Carl. He was an interesting cat. He almost always wore shorts no matter the weather. The girls were all super creeped out by his vibe and he drove a very expensive car. I believe it was an early eighties two-door, fourth or fifth generation candy apple red Cadillac Coupe de Ville.
I kinda always wondered what a night watchman was doing driving such a nice car, but it never occurred to me that there might be anything to it. It wasn’t until one day when another hotel employee tipped me off that things got sticky for Mr. Carl. The employee who gave me the information was one of the engineering employees. His brother operated a bottle depot in a neighboring town. What he told me was according to his brother, Carl was a regular customer and always had a large load of bottles. Now, that is not so unusual but what was odd to the bottle man was the fact that his bottles were always beer bottles and a perfect assortment of brands. Most customers came with one or two brands of beer as empties, not 10.
With this interesting piece of information, it didn’t take long to figure out what Carl was probably up to and how he could afford such a nice ride. With a little digging, I found out that part of his nightly duties was to take the hotel truck and retrieve the garbage and bottles from the golf course clubhouse that was located away from the main hotel. He was to collect the trash and bottles and bring them to the hotel, putting the garbage in the dumpster and the bottles in the bottle room. It was beginning to become clear what Carl might be up to. With this knowledge and after speaking with my GM, we decided to lay a trap.
We had to be careful because we suspected Carl, but we didn’t know who else might be involved. Sometimes these things are a joint effort. What we did was simple and effective. We asked the restaurant manager to include the number of empties being returned on his daily beer requisition and we conveniently isolated the main bottle room each night under the premise that there was a pest problem. We instructed the security department to place the golf clubhouse bottles in a different spot. At the same time, we got the hotel receiver to move the clubhouse bottles into the main bottle room each morning, noting the number of bottles each day.
Carl worked five nights per week and the clubhouse was open seven. On his two nights off another security employee was scheduled to do the clubhouse. In the beginning, things looked ok, but it didn’t take long for a clear pattern to emerge. On Carl’s nights, the bottle count discrepancy started out to be zero, the same with his nights off. After about a week and half, the discrepancies started, but only on Carl’s shifts. We kept track each day for five weeks and we had three weeks of daily discrepancies, minus a couple of weather days only on Carl’s watch.
Back to my game of inches. Carl was stealing an average of six 24-packs of beer bottles per day, so 144 containers per day or a whopping 720 per week. That’s $72 dollars per week or over $3,500 per year. That was 20-plus years ago! Carl was confronted with the information we collected and asked for an explanation. He was unable to come up with anything and he resigned that day.
So, what did I miss? Like you probably do, I just recoded the beverage purchases including the containers to the appropriate inventory account and I didn’t separate the containers in a separate balance sheet account. If I had done this, and if we had recorded the sale or return of the containers, I would have seen a constant deficit within my container account. Lesson learned the hard way for me and perhaps Carl too.
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