How do i figure out what my liquor cost is at the bar I help run?!
How do i figure out what my liquor cost is at the bar I help run?
Answers:
It all involves inventory and doing an accurate inventory count on a regular basis.
Create a sheet or spread sheet that has every bottle of liquor, beer, wine, mix, etc that you have on hand. It should also include the price of each item per bottle.
Count every bottle. Count opened bottles in 10th's. .9 .5 .2 etc.
The first time you count is your begining inventory.
The next time you count, is your ending inventory.
If you've purchased bottles, items, etc. they need to be added to you begining inventory.
So take your begining inventory + purchases and subtract your ending inventory for each item. That will tell you how many bottles of that item you used. Multiply that number times the cost per bottle. This is the cost of the liquor you sold/lost/wasted/etc. Do this for each item.
Add all of the items that you inventory up and that is your total inventory cost.
The next time you count, the previous ending inventory becomes your new begining inventory.
If you want to know your inventory percentage take the liquor cost number and divide it by the total liquor sales amount. Multiply by 100 and you have your liquor cost percentage vs sales.
Don't forget to count all of your beer, kegs, mixes, etc.
If your Percentage is too high, your mixing too much, giving too much away, or having it stolen.
Do these inventory counts often if you suspect problems. Less often if things seem to be about right.
Source(s):
Former General Manager for Full Service restaurant
common economics
how much you pay and how much you sell it for
How much you sell it for MINUS how much you pay EQUALS how much profit you make
im lowering my % by answering this but mr grisban is correct. The only thing he left out is some important facts.
And as bar manager i always help those in the industry.
your liquor cost can only go so low. your ideal % can sway between 19-25 % depending on what you are selling and what your prices are.. Anything lower and you are technicallly stealing from the public. anything higher and your bar staff is robbing you.
Keep in mind when doing your count though
not all bottles are uniform. some odd shapes give off a deception that they are at a level when they are not.
Count all bottles that are close to or under .1 as 0
wine should be counted by the .25 not by .1 ( this is because you should get on average 4 glasses out of a single bottle.)
Make sure your bartenders have a spill sheet or comp sheet..This makes a huge difference on you percentage. and will keep them out of trouble later on.
try to use the same two people when doing the count. One person always writes while the other counts. This way its always in the same handwriting and nobody gets confused wether a .4 is a .9. Also one persons .4 might be anothers .5.
consistancy is key.
Also try to keep any busted beer bottles that are still sealed. (wether its from shipping or from a clumsy barback) your distributer will give you a rebate or compensate you for this.
This will help lower your cost.
I think he mentioned it but just to recap count everything. Olives limes kegs juice bags cherries. Anything you spent money one that is used to make a drink goes into your entire profit margin. Which then effects you cost.