Simplicity & Emphasis: When you have a selection of 200 different products, all of your operational procedures become more complicated than they would otherwise be. Ordering is more complicated, storage is more complicated, taking inventory is more complicated and so is training your staff, checking in your liquor inventory deliveries, negotiating prices or even marketing your business. In addition, your customers find it harder to make choices and there is less emphasis on any single product. My local pub sells a lot of locally produced beer and cider. That makes it something distinctive and in a part of Somerset which is popular with tourists, that is a real selling point. If you have 200 products, including every type of flavored vodka you care to mention, it’s hard to be unique or memorable in any way. The emphasis is on the products you sell rather than what’s unique about consuming those products at your bar. A final thought is that since most bars do 90% of their volume from 10% of their products, you can probably cut your liquor inventory product selection down significantly more than you think and it will have no impact at all on the vast majority of your customers.
Storage space, volume and pricing leverage: Any given bar has a given amount of storage space in which to store their liquor inventory. Many bars have significantly less storage space than is ideal and in all cases your storage space is an asset which you should seek to gain maximum benefit from. When you have less products you have more space for each product meaning you can order more products by the case. In most states you get significant case discounts meaning ordering by case can reduce your liquor cost significantly using this tactic. When you have leaner product choice in your liquor inventory, you will also do more volume in the products you do have meaning you have more leverage in negotiating deals. We’ve encountered bars that have 67 different varieties of vodka. At some point you’re simply becoming a showcase for your distributors.
Server knowledge: A smaller selection will also yield benefits in terms of customer experience since your serving staff will be more knowledgeable about the liquor products you do have. Whatever time you invest in training your staff about the products you carry will be more effective when you’re business is focused on a few carefully selected items. This can be particularly true when it comes to your wines by the glass selection. An interesting selection of five whites and five reds which your servers can really talk about has many advantages over an endless list.
Uniqueness: This final point is not to be underestimated in my opinion. If you try and please every possible customer by providing everyone’s favorite product, you it’s easy to end up not really pleasing anyone because there’s nothing distinctive about what you offer. Rather than trying to have something for everyone, having something which is unique and excellent is much more memorable. As Steve Jobs said, “A lot of times, people don't know what they want until you show it to them."