The Successful Bar Owner’s Manual
Success or failure is always almost related to an operator’s capability or inability to focus on labor cost, beverage cost and food cost. Corporate operators have organized ways and steps to follow to keep an eye on these costs. These systems are highly constructive in providing up-to-date information. Even with the high- tech systems and the data they create, the management team must always continue to manage.
Many self sufficient operators still have issues with controlling their labor, food and beverage cost. Many do not have these systems. The struggle is a bit harder than that of the multi-unit operator. Here are some easy steps and tips to help you get these critical costs in line.
Product costs are something to always keep an eye on in this industry. Beverage costs are five combined costs. Liquor is the first, that normally costs 17%. Then it is bottle beer, which normally costs about 23-25 percent. Draft beer at 21-22% follows, then wine right behind it at 30% and lastly soft drinks at 6-8%.
Based on different sales mixes, prices and costs, a typical beverage cost is 21%. When your beverage cost exceeds your beverage sales, something is seriously wrong. Food cost is noticeably higher than beverage cost. Food cost normally runs 29-32 percent, trusting on the menu and pricing.
Managing a bar can be extremely hard work. MBB management is making it a little bit easier for you! We do that by making consistent tasks and helping lower costs each week. The bar inventory basics are knowing : How your bar is performing financially, what product variance is and where your shrinkage is coming from, how to set pars for each product, what your pour cost should be for each product, and which products sell well and which don’t.
Taking liquor inventory can be overwhelming but if you follow these steps you will sure to be successful. First, take your count the same way every single time. If you start right to left, follow the same pattern consistently. Along with being consistent with how you take it, also be consistent when you take it. For example, take it weekly, biweekly, or monthly. Find a method that works for you and your staff! If one person yells the names of the liquor and the counts out while someone else writes it down then do it! Also try to take your inventory while the bar is closed, trying to juggle taking counts while managing your customers can become tricky. Also be sure your employees are properly trained in inventory counting. You would be surprised how many less broken bottles and spillage you can avoid!