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Bar-i Liquor Inventory Blog

10 Benefits of Using Bar-i for Inventory with Multi-Location Bars

Performing bar inventory can be a complicated process with just one location, but when you have to track inventory for multiple bars, there are many additional issues which may arise to complicate the process even further. In these situations, it’s best to work with a sophisticated third party inventory provider instead of keeping this task in-house. This will ensure you’re able to accurately track the performance of every location in a consistent manner.

Bar-i’s system has been designed in a manner that makes it ideally suited to helping you manage the inventory process across multiple locations. You’ll experience a variety of benefits which will make it easier to ensure all of your bars are operating at peak levels of performance each month.

1. Results are Verified Down to the Serving

Inventory resuls verified down to the serving - Bar-iYou purchase your alcohol in large quantities (bottles and kegs), but you sell it to customers in much smaller servings (16 oz. pints of beer, 1.5 oz. measurements of liquor for cocktails, and 6 oz. servings for wine). Therefore, you need an inventory system that provides the level of granularity necessary to provide data that reflects the way alcohol is being sold at your bar.

Bar-i provides this level of precision with our inventory services. The scales used to count your bottles are accurate to the hundredth of an ounce, ensuring that your results will be accurate down to the serving. In addition, having an independent third party who is highly experienced in the inventory process to verify these results allows you to get the most out of your inventory efforts.

2. Easy to Compare Numbers across Locations

If you’re running multiple bars, there will always be some nuances associated with recording counts for hundreds of products across different locations, even if the same software system is used at each of your bars. Unless you have one dedicated person responsible for inventory at every location or you have the same exact process meticulously followed by every one of your bars, it’ll be very difficult to achieve data that allows you to accurately compare performance from bar to bar.

Several issues may occur which can prevent you from being able to compare your results across locations, including:

  • Different products might be included/excluded from counts at each location
  • Errors can occur during inventory counts that make the results at certain locations less reliable
  • Keg deposits and pricing of free goods may vary from location to location

All of these factors can complicate the inventory process, and if you want to achieve data that provides meaningful comparisons between the performance of different locations (which is an important purpose of the inventory process), you’ll need to have one system that is applied consistently at every location.

When you work with Bar-i, you’ll have one dedicated account manager who will perform inventory for all of your locations. This provides the consistency necessary to allow you to compare the performance of each of your bars.

3. Independent Oversight Improves Reliability of Results

Most bars are missing 15-20% of their product, and a level of shrinkage this high can significantly eat into your profit margin. One of the main purposes of the inventory process is to help you measure this performance. The lower the shrinkage, the better your bar is performing.

Independent Oversight for Bar Inventory - Bar-iIn many ways, the level of shrinkage you experience at your bar is a reflection on how well your managers are doing their job. A lower percentage of missing product is an indication that your managers are doing well, while a large amount of missing product indicates that there is room for your managers to improve.

It doesn’t make sense to have your managers produce the results for a task that is assessing their performance. This will inherently create a conflict of interest which makes it difficult to trust the accuracy and reliability of your results. When there are multiple locations, it will be even harder to trust that your results are reliable since managers at poorer performing locations may feel that they need to provide numbers that are more in line with your better performing locations.

Bar-i provides independent oversight, ensuring that there is no conflict of interest for the person performing this task at each of your locations. We’re able to provide this service in a cost-effective manner since the counting will be done in-house by your staff. However, all reports will be prepared by your account manager who will not have any incentive to adjust the numbers in a manner that demonstrates a better level of performance by your managers.

This independent oversight allows you to be confident in the accuracy of your data. Anytime you don’t understand who we arrived at the numbers generated in your report, you can give us a call and your Bar-i account manager will walk you through the process so that you understand all of your results.

4. Error Resolution System Improves Accuracy of Results

There are many opportunities for errors to be introduced into your inventory results. Human error is inevitable from time to time, and counting errors, data transfer errors or calculation errors will lead to inaccurate results. This may cause you to experience issues such as a bouncing liquor cost which won’t be a true reflection of your bar’s performance.

Bar-i’s system accounts for:

  • What was on-hand at the start of the inventory period
  • What was delivered during the inventory period
  • What was sold during the inventory period

This allows us to calculate down to the ounce how much of every product should be on-hand at the end of the inventory period. We’ll compare this figure to how much of every product is actually on-hand, allowing us to see where errors may potentially be occurring in the process. We’ll then verify these errors by double checking counts, verifying recipes, and going through all of your data to determine what went wrong.

Our robust error resolution system provides you with a way to achieve accurate results that are more useful and will make it easier for you to implement changes that will improve the performance of your bars. Having an error resolution system is even more crucial when you have numerous locations, since there are many more chances for errors when this process is being performed multiple times during every inventory period.

5. Our Support Systems Set Your Managers Up for Success

When you’re running multiple locations, there will inevitably be a variation in the quality of your managers. You’ll have some super star managers who have been with you for years, know the business inside out, and do a great job at ensuring your bar is being run properly. But you’ll also have some managers who are less experienced and may not have the skill set at this point in their career to lead as well as your top managers do.

This variability is magnified when an experienced manager leaves and is replaced with someone new who needs to learn all of your systems and processes on the fly. If you’re using an in-house inventory system, this becomes one more thing for your new managers to have to figure out at a time when they’re busy learning the menu, getting to know the staff and trying to understand all of the other nuances of the way your business is run.

Bar-i will run the inventory process for you, allowing your new managers to focus their energy on learning the other aspects of the day-to-day operations at your bar. In addition, we provide training videos to get your new managers up to speed on their role in the process, which mainly consists of performing the inventory counts.

This allows your inventory system to continue without any issues when a new manager takes over this task, and it helps you avoid numbers that vary wildly while your new manager is figuring out the process. As a result, changing personnel won’t affect the quality of your results, which is particularly important when you have multiple locations. Due to the larger number of managerial roles needed for multiple locations, manager turnover is always higher than when you only have one bar to run.

6. Faster Counting Makes Better Use of Your Managers’ Time

Bar-i Inventory System Reduces Counting TimeIn general, most managers don’t like doing inventory. It’s a tedious task that takes their time away from performing the important tasks associated with the day-to-day aspects of running a bar. When you work with Bar-i for your inventory, you’ll experience several important benefits, including:

  • Achieving consistent results that you can act on to help improve the profitability of your bars
  • A faster counting system that will streamline the process and provide a better overall experience that is a more efficient use of your manager’s time

The reduced time it takes to perform inventory counts becomes magnified when there are multiple locations. All of your bars will benefit from having manager time freed up from the inventory process so that it can be used to run your day-to-day operations.

7. Efficiency Index Tells You Which Managers Need Improvement with the Inventory Process

At the bottom of our reports, we score the manager out of 10 on 5 different categories related to how well the manager is providing us the information we need when we need it, and how well the manager responds to our suggestions. This will give your regional manager a way to evaluate how well each bar’s manager is doing their job as it relates to the inventory process.

As a result, your regional manager can look at the efficiency index scores and instantly know which managers need to be putting in a stronger effort on the inventory process. This allows you to address problems as they occur instead of having them fester over several months.

8. Inventory On-Hand will Remain at Appropriate Levels

In general, bars should have about 4 times the amount of inventory on-hand compared to what is used per week. However, we’ve found that most bars have way to much inventory on-hand (in our experience, many bars keep 5-10 times as much as is used per week on-hand).

Having such an excessive amount of inventory on-hand unnecessarily ties up capital and takes up lots of room at your bar, making your operations less efficient. Bar-i often is able to halve the amount of money bars have tied up in their inventory. This will provide 2 important benefits:

  • It frees up working capital for the business
  • Counting inventory becomes much faster since there is much less to be counted

9. Our Strong Industry Knowledge can Benefit Your Entire Business

Benefits of Bar-i Inventory ServicesYou know your business really well, you know your customers, and you know what works at your bar. This knowledge is crucial to your ability to run your bars well. However, knowing the intricacies of your business is different than knowing the intricacies of the inventory process.

Bar-i can provide the perspective of an expert who solely focuses on inventory and understands the unique issues associated with this task. We’ve worked with hundreds of bars and have seen just about every possible inventory scenario. This deep, broad knowledge of the inventory process can have a far-reaching impact on your business. It allows us to advise you on how to improve all of your processes in order to get the best possible results on a consistent basis.

10. End of Month Values are Easily Determined

Most bars with multiple locations are doing inventory on a weekly basis. This is the most effective approach when you have several different locations to track. But the downside of weekly inventory is that it may potentially make calculating end of the month inventory values more complicated.

Often, inventory day won’t fall on the right day to provide these end of month values necessary for your accounting. If you’re using an in-house inventory system, it will be very challenging to accurately determine these values.

Because of the precision of Bar-i’s system, we can easily predict forwards or backwards from the count either right before or right after the end of the month to determine your end of month inventory values with a high degree of accuracy. These predictions are significantly more accurate than what can be accomplished with an in-house counting system due to the high level of inaccuracy inherently built into in-house inventory systems.

If you’d like to learn more about how Bar-i can help you improve your bar’s operations and maximize profitability, please contact us today to schedule a free consultation. We serve clients nationwide from our offices in Denver, Colorado.

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Topics: Bar Inventory, Multi-Location Bars

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