7 Simple Cost Saving Tips for Bar Inventory Management from Someone Who Lived It
Do you have your bar’s back? No really, when it comes to your bar inventory management, are you pouring the right amount of time, energy and technology into it? There’s no doubt we could all take a minute to take inventory of our own inventory management best practices. We tapped HotSchedules Senior Consultant, Sabrina Duren, […]
Do you have your bar’s back? No really, when it comes to your bar inventory management, are you pouring the right amount of time, energy and technology into it?
There’s no doubt we could all take a minute to take inventory of our own inventory management best practices.
We tapped HotSchedules Senior Consultant, Sabrina Duren, who’s held bar manager roles at four different restaurants, to give us some simple but expert tips on how you can save on liquor costs with better bar management.
1. Know Your Clientele
Knowing your clientele makes all the difference in the type of alcohol you serve and will ultimately determine how you manage your bar costs.
Do your patrons prefer a bottle of Budweiser or an expensive rosé? If you run a sports bar, for instance, Sabrina recommends that you stock up on bottles, cans and kegs of the right brew.
You won’t need that cheap beer at a fancy steakhouse, though. Sabrina says that because wine is the number one seller, you need to be focused on managing profits per glass.
2. Stock The Right Mix
At the steakhouse, Sabrina says that they focused on the wine and cocktails, but that it never hurt to have a small stock of low-cost options in the back. “You’ve gotta know what to stock to maximize the margin. Which sounds like a no-brainer, but there’s a real art to it.”
Your regular steakhouse guest could also just want to sit down with a Budweiser beer. Overstock that beer and you end up eating the costs. But understock and your regular might end up across the street.
Sabrina recalls another time when she had to place a large liquor order for an event. She put the plan together for her manager, who was quick to point out some issues. “I had ordered 30 bottles of Grey Goose. He’d done these events before and knew that even though the Grey Goose sounded like the right choice for a high-end event, that 30 was way, way too much.
You’ve gotta know, for instance, that keg beer is cheaper than bottle or cans and typically, the margins are better too.
3. Always Measure Waste
One of the biggest cost sucks when it comes to managing bar inventory, Sabrina says, is not measuring your bar’s waste. Waste can happen for a number of reasons:
- Not properly measuring, storing and cleaning your kegs
- Not having a firm grip on your on-hand inventory
- Ordering too many expensive items for an event
- Not accounting for waste down to the exact dollar
Fixing your waste practices is as simple as taking note of that draft beer that spilled before you gave it to a guest but doing it in tool that doesn’t get lost. Waste from spillage, Sabrina says, can be up to one percent of your inventory costs. Those dollars add up fast if you’re not monitoring how much it happens or taking steps to reduce it.
Which begs the question, how do you go about reducing bar inventory waste? One of the tried and true methods is teaching your bartenders good habits and then holding them accountable with regular tests.
“We instituted a pour test to minimize foamy beer pitchers,” says Sabrina. “If a bartender didn’t perform the proper pour, they were sent home.” Hard-core, yes. Effective, you betcha!
This goes for liquor as well. Your bartenders should be pros at making drinks for your customers. Pouring too much or making a drink wrong are quick ways to lose money. Consider giving a quick lesson on pouring drinks an hour before you open, and back it up with regular in-person and online testing.
4. It’s Not If They Steal From You, It’s How Much
Even though Sabrina admits she’s seen bartenders walk out with $1,000 in a single night, she believes honesty is the best policy.
We all know bartenders comp drinks. The way to keep it under control is to establish comping rules and give bartenders a number they can give away each night.
This applies to your stock and storage as well. No doubt you’ve heard horror stories about employees walking out with expensive steaks or cases of wine. Sabrina has worked in bars with locks and chains on their stock. She’s also worked places where there’s a policy of trust.
“The policy of trust always worked better than a culture of distrust,” she says. “My mentor always said, ‘it’s not a matter of if they’ll steal from you, it’s how much.’ If you can control the amount and build trust with your staff, your stress and your P&L will thank you.”
5. Keep Your Revenue and Inventory Tied Together
“The person taking inventory should understand how it impacts the business,” Duren says. In a restaurant, that person is usually the bar manager. Offer extra incentives for proper bar inventory management, like tying bonus checks to weekly, monthly or quarterly inventory savings.
6. Make Bar Inventory Your B***!
Inventory gets a bad wrap. It’s not fun unless you have major OCD tendencies. But like any habit, over time it starts to become second nature and the benefits add up. “A lot of people will tell you do a monthly inventory. But if you really want to get some control over your costs, you’re looking at weekly or biweekly inventory,” Sabrina says.
If you can’t commit to weekly bar inventory management, start slow, count high volume items like Patrón, Grey Goose and Moët first, and then slowly progress to your wines, and keg beer. Send a calendar invite to everyone in charge of counting inventory and create a standard time each week, or bi-weekly to count your bar inventory.
7. Take Your Counting Mobile with an Inventory App
Bar inventory can take a really long time to complete, especially if you have a lot of square footage. When Sabrina worked at the brewery she would easily spend six hours just counting not to mention the additional time spent re-keying that data into a separate system.
“Mobile is changing the whole inventory management process,” Sabrina says. “Seriously, the inventory apps out there reduce the time it takes to count and free up your managers to think about other things. I don’t even want to think about all the errors that were probably made by accident when we were doing it the old way. Inventory apps keep it all in one spot, you can count faster and there are way, way less errors.”