How do you determine just how much inventory is right for your establishment? If you’re opening a new bar then it is s little easier as you can start from a small base and build as you require. You are in control and can add product as needed. Unfortunately the majority of the industry is stuck with what they have got and it keeps growing to a point of being unmanageable.
One of the most challenging points for owners to accept is to stop looking at stock as “stock” and start thinking of it as cash. What I mean by this is that if you are holding $10,000 of product then that is no different to you holding $10,000 of cash. If you didn’t have the stock then you would have the cash. The question then begs, would you carry this much if you realised that you had $10,000 tied up in stock?
Over time most bars let their inventory grow to the point of almost being unmanageable. New products are added while the old slower ones still remain without depleting and remain there gathering dust behind the bar. When it comes to those products that sit on your back shelf, you’re often talking years that product is sitting there.
So what can you do about it? The first thing to do is track its depletion rate. If it takes longer than 6 months to turnover then you have to question if it is worth retaining? Anything that takes over 9 months to sell through should be deemed as history and a plan developed to get rid of it. You can do this by making up some cocktails or special drinks that this product could be used in as a base. Use a bit of imagination and make up a Cocktail of the Week.
Once your problem stock has gone ensure that you have adequate stock ordering methods in place to ensure that it is not replaced. As bizarre as this sounds there are many bars where staff doing the ordering see a particular product disappear and then reorder it.
– Peter Nelson, Managing Director, Bevinco Asia Pacific
