Liquor Sales!! - HELP!!

[kali6]

I want to know what is a good shooting point for a 1500 person capacity club on liquor managment. I need to know the over and under. We are pretty busy and average 13,000 on Fridays and Saturdays in liquor sales. I need a point to reference from so I can make adjustments. Or I need the formula to figure it out myself. Thanks alot..Kali6

[David]

Kali6:

I guess that I'm not really understanding what you are looking for exactly. Are you trying to figure pour costs? Cost of Goods Sold (COGS) or simple profit margins.

If you have 1500 people in your club on a Friday and 1500 people on a Saturday, you better be grossing more then $13,000 a night. An educated guess on my part would be more along the line of $20,000 to $22,500 range per night.

Give us some more information. What is your venue? What is the clubs demo? What do you think your average expenditure is? Market saturation etc and anything else that you feel pertinent.

I do have a couple of Excel Spread Sheets that I can show you.

[Baudtender]

Well, I just want to gasp, but I've been in your shoes, so
it's more of a commisserating gasp.

You've got your priorities out of whack. Most likely you have
concerned yourself with the gazillion things that go into running
a club of this size and have somehow procrastinated taking
care of the most important - getting paid for what you sell.

Yeah, well, welcome to the club - you aren't the first to make
that mistake in this business. (In fact, it's usually the first
mistake we all make in this business.)

Let's get this out of the way - there is NO SUCH THING as
allowable over/under. There is balance. The alternatives
to balance are incompetence, mechanical breakdowns, and
theft. The first two are nearly always insignificant sources
of loss, and always repairable. The third destroys great
businesses on a frequent basis.

Allowances on over/under is the slipperiest slope of all (a close
second would be the after-hours "decompression" staff ****tails)

If you simply don't allow it, it will magically not be a problem
once people are made to believe you.

No variance allowed. You get paid for what you sell, or you
don't sell for me. And you don't count your drawer, you and
a manager count your drawer and if it doesn't match the
Z count, it's gets cermoniously "frozen" with plastic wrap and
you get to come back early in the morning and recount it and
explain it if it's wrong.

What really concerns me about your questions is that you
apparently have not established dead-on inventory control
methods with a means to match it to your sales. You're
vulnerable as hell until you get that fixed, and I'd make that
my top priority - forget about formulae and rules of thumb,
you're volume is way past relying on that nonsense.

Baudtender

[Frank123]

There are some good inventory control services out there.... There is Bevinco (http://www.bevinco.com) and Infoco (http://www.infocoinventory.com) . These might be good starting points for you.....

[kali6]

Thanks alot. I do need a good method of inventory. I also want to know about how to tell what the bar is making. And that would help with the buying of liquor. What would be the formula for getting a total on liquor sales. Should we do it quartly or monthly? We are really wide open and need help..

[David]

By your posts and the PM that you sent me, it sounds like you don't have a current way of tracking your sales electronically (Point of Sale system, computer or inventory system). How do you control your sales now? What type of system or methods do you use? Is this an older establishment? Please tell us everything that you can on how you do business. This way, we can suggest an inventory control system for you.

[Baudtender]

Kali6 - you know, on reflection, I think I may have misunderstood
your "over/under" reference (if so, please accept - in Miss Emily
Litella tone of voice - "Never Mind.")

My experience has been that stock shrinkage (that which
disappears unaccountably without having been sold) can be
hugely significant to a business's bottom line, to the point of
destruction if left unchecked. When you see huge grosses
coming in, it's all too easy to lessen the priority of getting your
stock tracking under control, which is one of the worst decisions
you can make. The more you sell, the more critical inventory
control becomes.

There are many methods of inventory control, but they all
boil down to some basic principals:

1) Count what comes in.
2) Count what goes out due to:
A) Sold
B) Not sold, which includes such things as:
i) Comping and employee incentives.
ii) Spillage, breakage, incorrect ordering, incorrect
preparation, customer dissatisfaction, and spoilage.
iii) Usage for new product development.
iv) Usage as components for other stocked items.
v) Transfer to other stores.
3) Count what you have on hand.

If you have more stock on hand than you should, you're
employees may be under-pouring, watering down bottles, or
bringing in their own stock for sale (this is akin to why savvy
owners look at an over-cash register drawer with the same evil
eye as a short drawer.) If it's negative, you're looking at
overpouring or pilferage as your prime suspects.

Sales tracking is done with a POS register system. There's really
no substitute. A 4-department $149 Royal Register from Office
Depot is not appropriate. A system that can only track high-level
groupings such as "Premium Liquor" is little better. You really
need to track on the Product level in order to have any sort of
meaningful inventory control.

The other end of Inventory Control, stock tracking, comes down
to counting, either by manual or mechanical means. Items that
are sold as full units (think bottles of beer) are easy to count.
Items that are sold in increments (such as liquor or draught
beer) require mechanical assistance (such as flowmeters for
draught lines, and weight scales for liquor bottles.) But, since
you never allow anyone who sells stock to count it, it still boils
down to elbow grease, and there's no substitute for it except
failure.

How often you count (called the cycle) also depends on the
usage and expense of the product. If you use a lot of it, and/or
it's a high-cost item, you count it much more often. You develop
a list of "key items" that are checked very frequently, and count
other items less frequently. This is why product grouping (like
"Premium Liquor") doesn't work - you know that something is
wrong, but you don't know what - hell, you probably knew
that before you started. I also don't hide inventory control -
I do bottle counts/weighing right in front of the servers for the
psychological benefit of them knowing that we don't run a
loose ship.

Good luck,
Baudtender

[kali6]

Thanks so much. Well let me tell you a little about us. We are an older club and got new management and we are trying to go in the right direction. Starting with our inventory. I am not using micros or pioneer pros. We use some older system bought from an Air Force Base NCO Club. I do kow that it is ncr. However we use plu numbers to ring in drinks. Everything must be by number so there are alot of plu numbers. We have yet to hit our full capacity, but with new promoters and all maybe we will. I am taking on the job as Bar Manager officially this Month. I was head bartender behind the bar manager. I made the cut and he didn't. I really want to do this just right and get us where we should be. So I come to the best minds in the BIZ...Thanks

[David]

If your liquor control system and you POS is outdated, get rid of it and get a new one. Believe me, you will make more money then you have spent on a new system in no time.

[honeypumpkin]

Hi everyone,
i really need help. I have been employed to help at a beer bar( bottle only) to do some paper work on some losses that so happen to walk out the door. I need a manually spread sheet for the inventory. Does any body have a system.please help. Thanks honeypumpkin

[originolsin]

The Doc Forum has a lot of spreadsheets that will help with a manual inventory.

[Havensloft]

What kind of POS system do you suggest? What would be the cheapest and still be good for an establishment? And what would be good for a very small venue? Under 60? Are they complicated to learn?

[Rainee]

What kind of POS system do you suggest? What would be the cheapest and still be good for an establishment? And what would be good for a very small venue? Under 60? Are they complicated to learn?

If your place is big enough to multiple serving stations / servers at once, then I really think it is crazy to not have a POS system. You could get by without it, and there are some places that do, but it just makes life so much easier in terms of knowing what you sold, how much you earned on those sales, and what inventory was used but not sold for different reasons.

For a place small enough that you never have more than 1 server at a time, it kind of depends on your preferences as an owner. If you are there most of the time and you don't mind putting in the work to reconcile your inventory and sales by hand, you could live without it and save yourself at least a few thousand. I have put simple POS systems into bars of this size and I think its well worth it. However , if you are not that comfortable with computers and spreadhseet type of applicatins then you may find it more trouble than its worth. Getting external support to set up and maintain a POS system is usually more expensive than the actual hardware, so if you can't do a lot of that yourself you may not want the expense in such a small place.

[bargirl23]

kali-
here are some things that might help you...
1. if you don't have the funds to buy a new pos system, use your old one to do inventory. you said that every liquor has a different plu code. that is the first step. you can either do daily, weekly, or monthly inventory, i would suggest doing beer inventory daily for awhile and do everything in your bar weekly. in the doc box, i put a spreadsheet for weekly and i will post a weekly pour cost as well. you need to print up your z report for the plu codes (which is different than a z report to do your drawers). this report will have exactly what that register has rang up since the last time that you printed this report. you will do inventory, by the 1/10th. this means that you will look at each bottle individually and rate it between .1 and 1.0. .5 means its half full. once you have done that for every bottle, take your report and figure out exactly how many drinks have been sold for every bottle. for instance, you have plu#1 is for absolut and you have a total dollar amount of $36 and you charge $4 a drink or shot, then you know that you served 9 shots. now you look at starting inventory of say 1.0 and you have an ending inventory of .2 for absolut, you know that someone overpoured or gave out free. (there are 33 shots in 1 liter) so for every point is equal to approx. 3 shots, so if your bottle is .1 there are approx 3 shots left in the bottle, .2 = 6 shots, .3 = 9 shots, etc. i will work on a spreadsheet and see if i can get one for you to be able to input all of this, so you know what you are missing.

beer i would count bottle by bottle and since your plu's should show exact numbers of beer, you shouldn't have to do any math for this.

if our beer is ever off, my bartenders pay for the difference. i count beer every morning.

also, you should have a spill log for your bartenders, for wrong drinks, breakage, etc. but you also have to keep a close eye on it that they are not putting down drinks they want to give away, etc.

2. once you have this all taken care of, then you can move onto what you should be doing. the inventory should take care of a lot of problems. you will notice your pour cost has gone down, which usually makes sales go up. but on avg, you should be doing well over $20,000 for that size of bar.

i am going to work on a spreadsheet for you, and i will post it here as well as the doc box.

[bargirl23]

honey pumpkin-

i will post a beer only spreadsheet in the doc box, for daily, weekly, and monthly for you. the spreadsheets though are for if you count every beer individually.

[bargirl23]

here are the spreadsheets. i will also post them in the doc box

[Egipt]

Hi I need help i am going to run a Pub and i do not have a program or spreadsheet to work on i am not sure what do you need all to put in a spreadsheet?