Red Bull and the management of energy drinks

The popularity of Red Bull in bars is rampant, and deservedly so. It’s a great product and serves as a great mixer with Jagermeister, Cherry Vodka, Tuaca, Southern Comfort and Bacardi (numerous flavors of Bacardi rums mix great with Red Bull), to name a few. It also sells well by itself – in the can. Its use is endless.

If your bar stocks only Red Bull as an energy drink, and it is used as a “mixer” for the Blaster or Cherry Bomb, then you probably have an inventory control problem with the Red Bull.

I have been using the “1 for 1” inventory technique to manage Red Bull by the can. In other words, if a customer orders Vodka and Red Bull, they get the shot of Vodka and the entire can of Red Bull. I charge an extra $3-$4 for the can of Red Bull (house policy prevails). This way, every time Red Bull is used as a mixer I know I depleted the entire can from inventory – not a partial can. And, the customers seem to appreciate getting the extra Red Bull. It’s similar to the French 75 from yesteryear. That was when the Tom Collins drink would be topped off with champagne from a champagne split bottle, not the usual Club Soda or 7-Up. You would charge the customer, say, $5 for the Tom Collins and an extra $10 for the split of champagne. The customer would get the entire bottle of champagne served with the drink. For inventory control, you would ring each part of the French 75 separately on the register, or you would have a pre-priced key of $15.00 under the name French 75. Every time you rang up a French 75 you knew you depleted 1 full champagne split bottle from inventory.

Today there are numerous drinks being made with energy drink additives, such as the “blaster” or the “bomb”. It is “assumed” they are automatically made with Red Bull. Not so! “Jager Blaster” and “Cherry Bomb” are extremely popular on the West Coast. If you have an energy drink on your soda gun you can make those drinks without using Red Bull from the can, but as a courtesy to the customer, I would let them know it’s not Red Bull. It’s a good idea to “up-charge” an extra $.50 to $1 for the energy drink mix from the soda gun.

However, if a customer asks for a “Jager Blaster and Red Bull”, you had better give them what they have asked for. There

Red Bull

Red Bull

are laws against substituting for Red Bull. Of course, the customer pays extra for that type of order. I would charge them, say, $7 for the Jagermeister and an additional $3-4 for the can of Red Bull – and give them the entire can! Otherwise, how do you control your Red Bull inventory? Bars that try to get 2-3 drinks per can of Red Bull might profit more, but you lose control of your Red Bull inventory. And Red Bull is expensive!

Do you have a policy in place with your employees about the personal consumption of Red Bull, or any other type of energy drink that’s in a can? Most employees, particularly bartenders, think it’s their right to pop open a can of Red Bull any time they wish, WITHOUT PAYING FOR IT. This spreads to the servers, then security, and of course, management thinks they’re entitled, too. At $1.32-$1.37 per can, it adds up quickly. The cost of 4 cans of Red Bull is the same as the cost of a liter bottle of Well Vodka! Red Bull is about 17 cents per ounce as compared to 8 cents per ounce for Heiniken or Corona.

I recommend a separate POS key for EMPL RED BULL. Employees should be charged, say $2, for the Red Bull. For those of you thinking ahead, what’s to stop bartenders from abusing that key, using it for favorite customers? Simple. An employee can only purchase Red Bull from the bar with management permission!
Red Bull costs anyone about $2.25 from a convenience store. Why does an employee think it’s free at their bar?

The entire industry should be acutely aware of Red Bull’s continuing efforts to protect their product. Red Bull has recently reached negotiated settlements from lawsuits initiated against restaurant/bars in New York City, Las Vegas, Philadelphia and San Diego for “passing off” other beverages as Red Bull. Other lawsuits are pending.

Red Bull has every right to preserve the integrity of its brand and to ensure that Red Bull drinkers are not misled when they order Red Bull and instead receive another beverage in its place. “The defendants in the lawsuits filed by Red Bull each were repeatedly warned that the passing off of substitute beverages as Red Bull damaged the Red Bull brand, deceived consumers and violated federal and state laws”, said Jim Goniea, an attorney at Sonnenschein, Nath & Rosenthal representing Red Bull. Mr. Goniea added, “Although Red Bull would prefer to resolve passing off issues whenever possible by educating restaurants, bars and nightclubs concerning their legal obligations and by obtaining voluntary compliance with the law, Red Bull has made a decision to aggressively pursue those who persist in deceiving Red Bull consumers by serving them a substitute product without warning.”

A bartender friend told me of her recent experience at an “in” place in San Diego. She walked up to the bar and ordered a Red Bull. The bartender reached for the soda gun and proceeded pouring an energy drink from the soda gun. The bartender handed the drink to my friend and said, “$10 please”.

My bartender friend knows that Red Bull does not come out of a gun (most customers don’t). She said, “I asked for Red Bull. Why aren’t you giving me what I asked for?” The bartender working said it didn’t make any difference, one energy drink to another. My bartender friend, (and the entire Red Bull company), strongly disagree. She refused the drink. “I’m not going to pay $10 for a Red Bull and not get it”.

If your bar serves Red Bull AND another energy drink, I suggest you have a policy in place, in writing, that each bartender/server sign. It could read something like this:

“I _________________________(print) hereby agree to sell and serve Red Bull if the customer asks for it by name. I will not sell or serve a substitute product for Red Bull if the customer requests Red Bull.”

If you do not sell Red Bull, but you do sell another energy drink, and the customer asks for a Red Bull, I would use this statement, filled out and agreed to by all bartenders/servers:

“I_____________________________ (print) hereby agree to say to the customer, “We do not sell Red Bull. Would you like to try (have) _________________ (an alternative energy drink/beverage to Red Bull).

– Bob Johnson, CBM