If your bar already offers bar tabs, you'll know that the convenience of opening a tab and ordering drinks from the table encourages customers to stay at your premises longer and increases average spend.
But offering a tab service is a risk. A survey by the Restaurant Association found that 14% of hospitality operators have noticed an increase in the number of customers coming to their establishment and intentionally leaving (or attempting to leave) without paying.
Even if you take a credit card from your customer to keep on file, it may not have enough credit on it to cover the cost of the tab, or worse - it could be stolen.
So, how can you reap the rewards of offering a tab service without putting your business at risk of lost revenue?
The answer: Credit Card Pre-authorisation.
This payment solution is free to use and available on all Verifone EFTPOS terminals (if you're connected to the Paymark network you'll just need to make sure you have software version 2017 or above, you can check with our customer team if you're not sure).
If you're not already using pre-auths to manage bar tabs, here's six reasons why you need to start right away:
1. Peace of mind
Credit card pre-auths allow you to check a card is a valid card (i.e not stolen!) and allows you to make sure the card has available credit on it. Instantly identify a potentially risky card before you serve the customer.
2. One swipe is all it takesWhen you use pre-auths to manage bar tabs, your customers only need to swipe their card once as you don't need their card back to complete the transaction. This is a win-win for you and your customers! Reduce queuing and eliminate the friction of taking payment every time your customer orders another round.
3. Easier for them, more revenue for you!
The easier you can make it for your customers to order from you, the more likely they are to stay longer and spend more. Since your customers only have to approach the point of sale once this means more socialising (and more spending!). Make sure you have plenty of roaming servers to take orders and bring customers food and drinks.
4. Wave bye bye to the tab book
Why pay your bar tender to waste precious time looking through the tab book for your customers' credit cards when they could be focused on serving customers? If you use pre-auth bar tabs, when it’s time to close the tab your customers can simply let their server know they’re done, giving your staff enough time to complete the transaction and pass them their receipt while they finish their last drink.
5. Safety first
Reducing queuing helps clear up the floor to make it easier and safer for your servers and other customers to get around your establishment. Plus, if you offer table service it also means customers are not trying to navigate across a crowded bar with two (or three!) full pint glasses - which we all know can be a disaster waiting to happen! Keep your customers in their seats and keep spills to a minimum.
Would you feel comfortable handing your credit card to a total stranger? Well, why do you expect your customers to give you theirs?
Since you can give your customer their credit card back once you've taken a pre-auth, your customer’s credit card can stay safely in their wallet, where there’s no chance of it getting lost behind the bar, stolen or skimmed. This is a much better customer experience, but it also lifts the burden of taking care of a tab book full of cards off your staff.
Start using pre-authorisation bar tabs today! Get our comprehensive guide to setting up and using pre-auths here.
While you're here, why no check out our other content on topics such as credit card fraud and managing pre-authorisation?
Editors note: blog content updated on April 22, 2020