For those who haven't ever worked in a bar, it can be all too easy to assume that owning or managing an establishment is just one big party. Everyone just hangs out and does shots with customers, right? You know better. In fact, you have probably spent hours in the stock room counting bottles for inventory long past closing the door behind your last patron.
You throw on an old jacket and discover $50 in the pocket – free money! In reality, of course, that $50 is money that you earned but couldn’t enjoy because it was hidden away from you.
Today we are going to go over one of the most important steps in bar inventory analysis for all bar and restaurant owners.
What’s a good number? I can’t begin to tell you how often I get the question. In our day-to-day operations, or out and about, at a convention, even at a party. When someone finds out what I do, they ask “What’s a good number for (blank)?” I also get inquiries from operators, owners, industry people and vendors. So here are some of my answers to the more commonly asked questions.
There are two kinds of bar managers in this world: those who encourage the free pour and those who are wholeheartedly against it. While each side of the argument certainly has some valid points, a lot of it might just come down to proper training. The free pour is a skill that needs to be practiced and perfected so that the drinks still taste great, customers are happy, and the bar is still turning a healthy profit.
Bar Practices: The Best and the Worst
A well run, profitable bar reflects a disciplined code of conduct. When you establish a clear set of rules and expectations, you set the scene for success. When you communicate your expectations both verbally and in writing, you’ll leave no room for doubt. You’re also able to create a benchmark for performance measurement, incentive programs, staff rewards or disciplinary action.
Even small expenses can add up over the course of a day as your bar or restaurant pours hundreds of drinks and serves countless meals. From putting fewer nuts and berries on salads to not salting pasta water to preserve the life of pots, some businesses are more than happy to cut corners if it means more profit. While sacrificing quality in the name of savings may be a short-term solution, you will have a lot more to worry about if customers stop coming to your establishment. Fortunately, there are some ways how top bars and restaurants cut costs while ensuring quality isn't impacted, that will not only preserve existing customers, but work to increase the number of patrons.
Introducing a new menu or running a new promotion can help reduce sitting inventory and increase sales, but how do you know just how successful your efforts have been? It is important to identify and use Key Performance Indicators to measure whether you are getting the most out of your time and money.
A great mixologist will bring plenty of creativity to their drinks, but they can make even more profitable cocktails by using a little bit of data to further inform their ingredient choices. While it may sound counterintuitive to argue that crunching numbers can be a tool for creativity, today's technology allows these two areas to blend seamlessly. Before you put together your next drink menu, here are some ways you can be more strategic about designing delicious drinks.
Offering simple food and beverage pairings provides an easy way to engage patrons and give them more of a dining experience - even if they are just saddling up to the bar for a quick drink after work. It also allows you to promote more expensive spirits and drive profits.
Managing a bar and restaurant means having to deal with employee turnover rates that you just don't see in other industries. That means more time spent hiring and training staff and less time spent on other areas of the business. While high turnover is part of the industry, there are some steps you can take to make sure that your employees want to stick around.
Employment law is dangerously complex. Managing a bar or restaurant with locations in multiple states means you have to follow different rules in different locations. The complexity is enormous and is compounded by the fact that these laws are constantly changing.
You put in the hard work and long hours, and your bar has become a success. While most people would sit back, catch their breath and enjoy the moment, your mind is already focused on opening a second and third location. Your friends and family may be questioning your sanity, but we certainly applaud your ambition. However, before you make another huge commitment, there are some important topics to consider. Here is what you need to think about before you decide to become a multi-location bar owner:
This blog is about the most important aspect of sales and inventory control.
Don’t get me wrong, there are a lot of important steps and procedures a manager or owner must do and put in place to make sure his or her inventory and sales are correct and nothing is missing. And if I want to be literal, clearly locking the doors at nighttime is the most important step!
Owning and managing a bar is a labor of love. You have to work late nights and holidays, deal with disgruntled customers and try to keep track of an inventory and make sure that the books always balance out. With so many challenges, it is important to surround yourself with a stellar team. Bartenders handle more cash and are responsible for more sales than anyone else in your establishment. They are charged with a lot of trust and responsibility, which can make it all the more disheartening when you start to suspect that an employee is stealing.
In today’s unpredictable economy, many restaurant owners are in need of a jolt - something that doesn’t only attract new customers, but will also want to make existing customers come back every time. There are many elements that affect the overall value of your restaurant, from marketing and the menu to hygiene and technology. It’s important to take all these features into account when you’re trying to improve your business. There are of course many potential ways you can achieve growth, some of which we will discuss in this article.
A wise bar operator once told me, “any schmuck can put together a liquor order, but a smart bar manager knows the fine line of ordering enough so they never run out of anything, but never unnecessarily purchase too much inventory and have money tied up in stock that does not sell.”
When I was given this advice, I was managing a bar with approximately $150 to $200K in liquor, draft and bottled beer sales a week. My weekly liquor order would vary from $30 – $50K a week depending on what was going on. It was one of the biggest expenses of the bar. The raw size of the liquor order made it a huge concern for the owners, who wanted to make sure it was done right every week. Every week was challenge to find a balance between making sure stock was always where it needed to be so we never ran out of anything, but also not to over spend. Over spending could have meant thousands of dollars tied up in inventory that the business could have used elsewhere.
Whether printed or emailed, many companies regularly publish newsletters in the hopes of getting customers returning for repeat business. But what differentiates an average newsletter that gets grouped with the junk mail from a great newsletter that earns its place in the “A” pile of mail? The content that a newsletter contains is the main factor that determines readership by those to whom it is sent. Plain, boring and vanilla content gets skipped over and tossed into the garbage with the rest of the junk mail.
As a bar manager, your afternoons, evenings and early morning hours are spent trying to create a unique experience for patrons so that they become loyal customers and brand ambassadors. While this might sound like a glamorous gig to outsiders, you know that it also involves hard work, much of which can be downright monotonous. Inventory alone can be enough to make you reconsider your career choice. But what if you could streamline and simplify the worst parts of your job? In a world where cars can now drive themselves, there is no reason you should ever spend hours counting and measuring bottles by hand. If you are, it is time to hire an inventory control company and take back your free time.
Most operators do not collect their customers’ contact information, nor do they have a follow up strategy to continuously communicate with customers outside of their nightclub or bar. The strategy of keeping a list of your present customers is the easiest, fastest and most cost effective way to get new customers into your bar. After all, your present customers have a positive opinion of you, know who you are, and are more responsive to marketing messages from you. Operators who are vigilant about incorporating some form of list building and execute regular follow-ups reap many benefits from doing so.