The Surgery - Is it wise to do my own stocktaking?

Dear Surgery: Having just taken on my first pub, I'm thinking of cutting costs by doing my own stocktaking. Is this wise, or should I pay for a qualified stocktaker to look after it?

The Surgery says: It must be tempting to try to cut initial costs by doing it yourself, and there are CD software packages that can assist you in this, but there are many pitfalls and it may be advisable to seek professional help.

The Institute of Licensed Trade Stock Auditors (ILTSA) has more than 400 qualified members covering the whole of Britain and Ireland. Each member has qualified by passing an extensive examination which tests whether they have the depth of knowledge necessary in the modern licensed trade.

They can be identified by the letters MILSA or FILSA after their names.

As a former licensee, ILTSA's Chris Swift knows the importance of using a stocktaker. He says:

"Any licensee with a reasonable knowledge of their merchandise who is reasonably proficient with numbers could expect to complete a stock report, but they need to ask themselves a number of questions:

Has the licensee got sufficient time to put aside for stocktakes - uninterrupted by reps, phone calls, staff and family?

Have they got the necessary knowledge and skill to measure, accurately and consistently, draught products and broached spirit bottles?

Do they have a knowledge of how to take account of post-mix ratios, cocktail recipes, liqueur coffees for instance?

Have they got the necessary knowledge to "read" and analyse the till report or EPoS system or the ability to obtain accurate cost and selling prices and a means to update them when and if necessary?

Do they have an understanding of allowances and how they can affect the result?

Do they have the ability to be completely impartial no matter what the result - it may well be a shock.

Do they have the time and patience to check all figures (or would they be tempted to introduce "extra allowances" to mask a deficit situation)

Do they have the ability to carry out all the above on a regular basis - whatever else is going on within the pub?

If the answer to each and every one of these questions is yes, then you are some way to producing a meaningful report - but consider now the following points which, I believe, separate the professional stock auditor from the amateur:

Are you able to interpret the figures that you have calculated and from them make worthwhile business decisions on a current and historical basis - ie, the waste and personal consumption figures with comparable units.

Are you able to pinpoint with some certainty the areas that are causing the problem?

Have you the ability to compare selling prices, cost prices and sales promotions in the immediate locality?

Have you knowledge of discounts in comparable units?

Are you able to "stand back" and identify problems that may well not at first be obvious to someone involved in the business on a daily basis?

Have you an up-to-date knowledge of current legislation and trends?

Are you able to impart your knowledge with integrity and discretion, with a certain amount of resolution if necessary?

The potential pitfalls of attempting your own stocktaking are enormous and a good, qualified stock auditor will normally save you far more than he or she charges. The average investment in any public house far exceeds that of the investment in a new car - would you attempt to carry out your own servicing to save a few pounds?"

For details of ILTSA members in your area, or general enquiries, contact the secretary, Diane Swift, on 01422 366633, e-mail dianeswift@iltsa.co.uk or visit the website at www.iltsa.co.uk