For decades, manual inventory management was the go-to method to track beer, wine, liquor, and other consumables behind the bar. But most of us have found ourselves on the losing end of these analog systems. Guesswork, misplaced paperwork, and late-night counts after a long shift all lead to an inevitable drop in revenue.
While some bar and restaurant owners see bar inventory software as an unnecessary expense, others have already reaped the benefits of this technology.
Today, we’ll share real-world examples of how our all-in-one POS system has revolutionized businesses and made sense of the bottom line.
We’ll cover:
The “Aha!” moments of bar inventory software
Even with meticulous record-keeping habits and highly trustworthy employees, shrinkage can seem unavoidable. But once you pinpoint the source of your losses, things will come into focus.
The surprising source of shrinkage
Generally, you can trace shrinkage behind the bar back to several major culprits. Errors at the register, inconsistent pours, and improperly calculated recipe costs can result in profit loss. Unfortunately, one study found that up to 75% of bar shrinkage was due to employee theft through overpouring, handing out free drinks, and even snagging bottles when nobody was looking.
However, there’s no way to pinpoint the cause without properly tracking your inventory.
Bar inventory software can let you track the data in real time. With full menu integration, you can see what goes out when and compare those numbers to what’s actually on the shelf, helping you pinpoint the causes of diminished revenue.
The power of precise recipe costing
Before you put a new cocktail on the menu, you probably sit down and crunch the numbers to ensure the menu price is reasonable for your customers and still turns a profit. But how can you use this data to improve your bottom line?
Great bar inventory software will allow you to input detailed ingredient and cost information for each menu item so you can see exactly how the numbers pan out. Then, you can compare your actual vs. theoretical costs to determine where waste originates. This can help you spot drink recipes that need tweaking or bartenders who need additional training.
Additionally, your costs might change frequently. When your deliveries show up in the middle of happy hour, it’s easy to miss errors in quantity and pricing. But imagine if your bar inventory software could alert you when you’re charged more than usual for those ingredients. You could remediate inaccurate charges and easily adjust your menu prices when your costs increase.
Goodbye guesswork, hello confident ordering
Bar inventory software can do much more than show you where you’re losing profits. It can also help you visualize your sales and use your existing data to suggest which items to include in your next order.
A dual POS inventory management system can use your past sales, inventory history, and expenses to anticipate your needs. This power of predictive ordering can take the guesswork out of restocking. You’ll always know what you have on hand, which items are running low, and what’s out of stock. Furthermore, you’ll get suggestions for upcoming orders. All of this comprehensive information can streamline the ordering process and put money back in your pocket.
When you can see trends in your inventory and related figures like which days of the week you do the most business–or even which days you sell the most Manhattans–you can stock your bar appropriately. After all, you never want to run out of ingredients, but your budget and storage space limit the amount of inventory you can hold at any given time.
By getting a solid grasp on your beer, wine, and liquor stock, you can reduce the risk of stockouts and wave farewell to last-minute supply runs.
Beyond the numbers: unexpected benefits
Top-of-the-line bar inventory software comes with some surprising benefits that owners and operators don’t always expect. Here are a few additional perks to look forward to.
Staff empowerment and accountability
No one wants to be the bad guy, but when your stock runs short before it should, you’ll have to address the problem.
You already know that clear, definitive data allows you to see trends that illuminate issues like overly generous pours. So, when you find that certain staff members tend to be on the floor when shrinkage occurs, it’s time to take action.
Great bar inventory software will shine a light on your team’s weak links so you can decide how to move forward. Sometimes, all you need is additional training for your staff members to reinforce the importance of accurate pours. In these cases, jiggers and other measuring devices might help solve the problem. Other times, you’ll determine certain employees aren’t cut out for the job.
Of course, a strong team works best when there’s mutual trust, respect, and accountability. Opening up a constructive dialogue can start you off in the right direction. When employees feel valued, they’re more likely to go above and beyond to forge relationships with customers, make the experience enjoyable, and upsell those high-ticket items.
The end of “Mystery Stock”
When a bottle of liquor goes missing, most of us would like to chalk it up to inventory error. But unfortunately, overpouring drinks, ringing up items incorrectly, and employee theft account for the majority of shrinkage in the bar business. If you’re a bar owner, you’ve likely dealt with vanishing bottles a time or two and had to use your detective skills to track down the culprit.
Disappearing inventory can create an atmosphere of distrust and increase tension for both management and staff. This is problematic for everyone and must be resolved to foster a healthy work environment.
Implementing routine inventory management and regularly performing checks to ensure your actual and theoretical inventories match up makes it easy to determine which employees require additional training or aren’t a good fit for your business.
If you find an employee has been stealing outright, it might be time to add security measures to your establishment, such as cameras and locks on your inventory that only trusted managers can access.
Once you sniff out the source of your shrinkage, you can eliminate any lurking suspicion. You’ll be able to trust your staff, and your employees will appreciate not being micromanaged.
Time saved, sanity regained
Manually tracking inventory is a time-consuming task that can interfere with day-to-day operations. Depending on the size of your operation, it could take a well-established employee hours to catalog everything in the stockroom and then compare those figures to what you should have in stock according to your sales. Even then, you run the risk of restaurant inventory turnover calculation errors.
By automating this process, you’ll not only regain that lost time, you’ll implement a system that’s less prone to errors. Of course, going through your inventory manually is still important, but you’ll spend less time crunching the numbers to figure out what it all means.
Imagine what you could do with those extra hours each week. You could devote it to enhancing your drink menu, training bartenders, or treating your customers to an unbeatable experience.
Additionally, a fully integrated menu management system is a game changer in a fast-paced bar environment. From shifting happy-hour prices to last-minute menu changes, you can update your internal system with the touch of a button, so everyone is on the same page.
If that bachelorette party wipes out all your top-shelf tequila, you’ll be able to let your other bartenders know in real time. You can quickly alter prices, availability, and modifiers without missing a beat. This means less time spent apologizing to disappointed customers and more time turning a profit!
Lessons learned when choosing software
It takes time and practice to master any new technology, and we’ve made plenty of mistakes in the trial-and-error process. Here are a few things we’ve learned along the way.
The feature that made all the difference
We’ve all been there–your customers are ready to close out, but you’re halfway through making a complex drink order for another patron. Everyone is getting impatient, and the pressure is building.
Well, relief is in sight!
With CAKE’s state-of-the-art software, your customers can pay however they like. QR code payments allow customers to close out their tab without having to flag down a bartender. Best of all, it’s fully synced to your bar POS system.
All checks include a unique QR code that your guests can scan with their phone and pay on the spot. They won’t even need to download a third-party app. It’s as simple as scanning with their phone’s camera, adding gratuity, and confirming the payment.
This does more than just streamline the closeout process. It reduces the chance of chargebacks and disputes with the bank because your employees never handle the customer’s card. Since guests won’t have to wait for servers to run the payment, it can also increase your turnover rate, putting more cash in your pocket.
Finally, the system can encourage customer loyalty by capturing valuable information about your guests and creating a customized experience, like letting them know their upcoming rewards if opted in.
Don’t forget about the people factor
Any high-quality bar inventory software should include 24/7 support available every day of the year. After all, in the fast-paced world behind the bar, immediate assistance is essential to keep things running smoothly.
When you choose CAKE’s all-in-one POS system, you’ll get more than just plug-and-play hardware. You’ll also receive tons of training resources with CAKE University, the platform’s comprehensive knowledge base.
While this simple system is intuitive and easy to use, assistance is never far away when you encounter an issue. You’ll have access to unrivaled customer support over the phone and through text, chat, and email. This can make all the difference when your bartenders are in the weeds and need help troubleshooting a problem, stat!
Bar inventory software wrap up
The right bar inventory software can streamline your day-to-day operations and help you visualize critical data so your business can run more efficiently. You can use your bar’s analytics and reporting to simplify inventory management, identify shortcomings, and ultimately increase your ROI. CAKE restaurant POS was made for the hospitality industry–we’ve been behind the bar, so we know which features can make the biggest difference and help you increase your profits.
We know implementing new technology can be overwhelming. That’s why we offer personalized demos to help you familiarize yourself with CAKE and determine whether it’s the right product for your establishment. Reach out today to learn how this system can revolutionize your business and streamline your workflow.
We’d love to hear how your bar POS system has simplified inventory management for your business!
