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3 min read

How to Reduce Liquor Cost Without a New Inventory App

If you already know your variance and it is bad, counting again will confirm it rather than change it.

Matty HerreraBy Matty Herrera, Founder & CEO, Delta Kinetics

Published Updated

Delta Kinetics title card for the article How to Reduce Liquor Cost Without a New Inventory App
On this page
  1. Key takeaways
  2. 1. Put a pourer with a known count on every high volume bottle
  3. 2. Log comps with a reason
  4. 3. Agree the recipes, then teach the balance
  5. 4. Count the fast movers weekly, everything else quarterly
  6. 5. Why look at variance by shift rather than by period?
  7. Where does a tool genuinely help?
  8. Frequently asked questions
  9. Sources

Key takeaways

  • You can reduce liquor cost without a new inventory app, because in most bars the problem is execution rather than measurement.
  • Five changes cost nothing but attention: measured pourers, reasons on comps, agreed recipes taught as balance, weekly counts of fast movers, and variance by shift.
  • Looking at variance by shift rather than by period is the highest value change, and the data already exists in your point of sale.
  • Variance spread across every night usually points to a recipe or pricing issue; variance concentrated on two nights is an execution issue with a shift pattern.
  • A tool earns its place by removing the assembly step, about two hours a week by hand, that kills the habit, not by measuring what you already know.

Frequently asked questions

Should I count inventory more often to bring liquor cost down?

Only if you genuinely do not know your numbers. If you know them and the number is bad, counting again will confirm it rather than change it.

Do I need an approval process for comps?

No. The post suggests attaching a reason to every comp over a threshold, with no approval workflow and no confrontation. Total comps fall because they are recorded, and the reasons cluster to show what is actually going wrong.

How often should I count stock?

Count the few products that carry most of your volume weekly, and everything else quarterly. The goal is not accounting accuracy but noticing a drift while you can still remember the fortnight it happened in.

When is software worth buying for liquor cost?

When the shift level breakdown would otherwise not get done. By hand it takes about two hours a week, every week, which is why almost nobody keeps it up past the first month. If you have the discipline and the time, you do not need it.

Sources

  1. Washington University in St. Louis (2013): IT monitoring effective in deterring restaurant fraud, 392 restaurants studied
  2. Pierce, Snow and McAfee (2015), Cleaning House: The Impact of Information Technology Monitoring on Employee Theft and Productivity, Management Science 61(10)
  3. Toast Support: Cash and Loss Management (Exceptions) reports, voids, discounts and refunds
  4. Square Support Center: View discounts, comp and void reports