Multiply the unit cost with the units of your recipe. This number should be based off the volume of business at your bar, your average weekly sales, and any events, holidays or other variables like weather and season that may affect sales. Sign up for free. We mentioned that the above formula for liquor cost percentage is a big picture way to approach calculating costs. Cocoa Liquor is derived directly from the beans, so its price is directly linked to the price of the beans. We mentioned that the above formula for liquor cost percentage is a big picture way to approach calculating costs. Looking at industry costs is a good guideline, but depending on your business, you will want to determine the ideal pour costs and margins for you. Read our post on Bar Inventory for more information about liquor cost and other important bar inventory formulas. Once you’re aware of the problem, you can make menu adjustments before your restaurant starts losing money. Here’s an example for calculating your liquor cost. Pour Size. Dividing the cost of the container by how many ounces it holds will calculate the price per ounce of the bottle. Law Enforcement. A goal should be to reduce your standing inventory to give you more spending power to purchase products you know will. Once you’re aware of the problem, you can make menu adjustments before your restaurant starts losing money. hbspt.cta._relativeUrls=true;hbspt.cta.load(5163161, '618513c0-e412-462d-ad07-1bda1f8b4404', {}); The next step in building a depreciating budget is defining your sales projection for each week. Cost per Shot. Human error is inevitable in the process of taking inventory and calculating liquor cost. Critics are calling the markups an illegal tax. If you're looking to drum up more business, there are other ways to do so without hurting a great revenue stream. About DABC ← Back; About DABC. Many people focus on employee theft as a major reason to put liquor control standards in place. Liquor cost formula . If your purchases and sales are consistent, then make a deal with your distributors that you will purchase X amount cases of Jameson per month, (or whatever timeline works best for you) and in return you will get a discount or no-charge on Y number of cases of Jameson. Liquor cost by category: X: X: X: Liquor cost & Accountability by product : X: X: Individual product variances calculated : X: X: Achieveable Liquor Cost Calculated (specific to your bar) X: X: Company standards consistently applied : X: Liquor costs are accurate, timely and comparable across stores : X: Master account manager provides the big picture : X: Setup/Equipment. One way to control pour cost is through your pour size (how much liquor is included in each drink). Essentially, it’s when a retailer determines a retail price by simply doubling the wholesale cost they paid for a product. This was mentioned above as a prerequisite to using a depreciating budget. These types of promotions eliminate the value of one of your best tools to generate revenue. In other words, for every dollar of sales generated by that drink, your cost is 10 cents. We mentioned that the above formula for liquor cost percentage is a big picture way to approach calculating costs. The only real issues you have to account for are pouring doubles or serving drinks on the rocks. Calculate liquor pricing; Organize Distributors; Find the margins to make your bar more profitable; This free liquor and drink cost worksheet calculates pour cost, margin and markup for wines, beers and spirits. A few more examples of typical call liquor are Smirnoff Vodka, Beefeater Gin, and Bacardi Light Rum. Knowing the food cost formula is just half the battle – now you need to apply it to your business. In this example you went over your budget by $990. Here at Barmetrix, we’ve spent over 15 years building systems and implementing strategies to help bar and restaurant operators minimize stock-to-sales variance across both food and liquor. Outside of the obvious suggestion to stop hiring thieves, here are 3 ways to control liquor portions. Once you find out the $ value of your standing inventory, then you can start to build your budget. All spirituous liquor sold at retail in North Carolina ABC stores is priced uniformly throughout the state. The Cocoa Bean is the basic raw material of the chocolate-making process which is traded on commodities exchanges in London (LIFFE) and New York (ICE). Let’s say your bar used $15,000 worth of inventory in a quarter. The liquor cost formula is: Liquor Cost = (Inventory Usage ÷ Total Sales) x 100 How to Calculate Liquor Cost: An Example . Use actual bottle prices when valuing your liquor inventory (i.e. Build your most profitable cocktail menu. Divide the usage mount by your sales revenue for the week and you will get your  liquor cost of goods sold percentage. Ultimately, the lower your liquor cost, the greater the profits you will generate from each drink. Access all your recipes from any device. Liquor costs, also called pour costs, are the ratio between the cost of products purchased and the revenue from products sold. Shoprite Bothasig. Selling wine for cheap kills your business. You have to do some math, but don’t be scared. You can also track pour data with these. .22 (22%) $11.36. It takes some due diligence, especially if you're trying to improve a poorly run program, but you can do if you follow the right steps. Contact: ... Pricing Program was passed as part of Act 39, the PLCB was required to price all products by a strict proportional pricing formula, which treated all spirits suppliers equally. So using our example from above, we know that a bottle of Corona costs you $1.11. Who We Are. Critics are calling the markups an illegal tax. This could be a bad thing. This post details 5 strategies to keep liquor prices low so you can turn a high profit on your cocktails and drink sales. Both of which change the serving size and alter liquor cost and profit margin. The Food Cost Formula in Action. A $.10 price increase across 132,000 units, without a drop in # of items sold, would result in $13,200 straight to the bottom line, not $50,000. Posted Jul 30,2004 1:08 PM . Liquor variance is a silent killer—slowly sucking the profits out of an unsuspecting bar business and distorting liquor costs. Usage Amount / Sales Revenue = Cost of Liquor Sold %. The starting and ending values of each product will help you account for the change in inventory during the time period being analyzed. You're better off creating wine pairings or and flights with your dead stock in order to sell it. This might have been why you spend $3,080 in your week 2 purchases. The markup varies from one state to the next, but ranges from around 25 percent to 45 percent. September 10, 2019 11:50 am . Trade groups representing the liquor industry are backing a bill from Rep. Jesse Topper, R-Bedford, to go back to the old formula system of pricing. Call Liquor. The majority of your revenue (generally around 80 percent) in the bar business comes from drink sales. In addition to federal and state taxes, the price of spirituous liquor is determined by a mark-up formula as stated in G.S. If the liquor inventory is not considered, your liquor usage will not be properly seen in your cost calculation. Before a business like a liquor store can be sold, it needs an appropriate value. If the bottle costs $20 and it holds 25 oz (the typical amount in a 750ml bottle), the cost per ounce would $.80. brandon: I realized while typing a post in the bar pricing program thread, I might as well start a thread discussing pricing as a whole and explain how to price by gross profit for food too for those that don’t know how. In the states that operate monopolies in the retail liquor industry, the price of liquor sold in Alcoholic Beverage Commission or state stores is set by the state government and is uniform throughout the state. Updated 05/14/19. To start your budget, you need to take inventory of every bottle and keg at your restaurant. It's the golden range for bar managers and beverage directors. Restaurants and Taverns. Example. Liquor costs, also called pour costs, are the ratio between the cost of products purchased and the revenue from products sold. Liquor cost formula . Liquor Cost Formula. To get your unit cost, divide the price per bottle by the size. In Part 2 of this blog, we will discuss some of the common problems encountered when calculating liquor cost and provide you with some useful tips to eliminate these problems. The pour cost is typically 20-25%. The benefit of a depreciating budget is that it makes your hyper aware of your purchasing costs. Track these numbers so you can compare your week-to-week inventory. Where the PLCB previously sold alcohol at a simple 30% markup, Act 39 gave it full pricing discretion. Restaurants and taverns typically mark up their liquors much more than liquor stores. Divide the first (purchases – inventory) number by the revenues. Liquor laws are convoluted and differ from state-to-state. Be aware of what you legally can and can not do when purchasing and selling liquor. Since then, the monopoly board's profits have increased significantly because, without any competition, it has been able to artificially increase the price of alcohol. Liquor Laws ← Back; Residents & Visitors. Ultimately, the lower your liquor cost, the greater the profits you will generate from each drink.As a result, it is in your best interests to carefully monitor your bar’s liquor cost and take … Lastly, you will need your bar’s total liquor revenues for the period. Price Lists Policies. Owning a liquor store can be very lucrative, but buying one after an inaccurate business valuation can dig you into a deep financial hole. Trade groups representing the liquor industry are backing a bill from Rep. Jesse Topper, R-Bedford, to go back to the old formula system of pricing. Now, after the week is over, you must perform inventory again. If you want to go by industry averages, shrinkage hovers around 20%. Smart promotions sell wine. Posted: 22 Jan 2019. Unless you're running a bar at an airport, then stay away from electronic pour spots which scream "I don't trust my employees.". Contact: ... Pricing Program was passed as part of Act 39, the PLCB was required to price all products by a strict proportional pricing formula, which treated all spirits suppliers equally. Use the equation above to find your usage amount. This is more than just putting together an order for your distributors. This can be easily done by making sure to have a modifier button in your POS system. Work with your distributor to get these discounts on any bottle you use in your well, any liquor that's a base for a popular cocktail, and any wine you have your glass pour list. A general idea as to the going rates in various states with quota systems can be seen in Table 2-5 on page 45. The typical time period most bars use for calculating liquor cost is one month, although 1- and 2-week time periods also work well. It is a simple formula which is easy to understand and does not require any complex understanding or difficult calculations. Rare High Demand Products. Use BevSpot’s free online drink pricing tool to make sure you are setting the right prices for all of your drinks and getting the profits your bar needs. Pre-built Excel template file with pricing formulas. $0.79 1oz Dark Rum. Price ($) = Cost of Ingredients ($) / Target Pour Cost (%) In a previous study, we’ve found that good target pour costs were 20% for beer, 14% for liquor, and 22% for wine. Opening Inventory + Purchases – Closing Inventory = Product Use. Liquor distributors love to see their products on menus and be used in high volume. * Record the distributor, date of invoice, date of payment, invoice total, invoice number, and check number if paying by check, so you have accurate information to reference. As a result, it is in your best interests to carefully monitor your bar’s liquor cost and take advantage of any potential opportunities to lower it. Liquor cost by category: X: X: X: Liquor cost & Accountability by product : X: X: Individual product variances calculated : X: X: Achieveable Liquor Cost Calculated (specific to your bar) X: X: Company standards consistently applied : X: Liquor costs are accurate, timely and comparable across stores : X: Master account manager provides the big picture : X: Setup/Equipment. You should be assigning a dollar value to all of that inventory as well. Understanding Chocolate Pricing. Here is the most frequently used wine pricing rule: Wholesale bottle price x 3 = Menu price. How to Calculate Liquor Cost Calculating your liquor cost is accomplished by dividing the value of the product used by the sales of that product for a particular time period. Liquor Cost, Speed Count Setup 4 – Instructions fill in Product info, Speed Count Setup 5 – How to Use – Make changes to the counting map, Speed Count Setup 6 – How to Use – count and data entry part 1 2 3, Speed Count Setup 7 – How to Use – Finishing Up, How to Paste POS Report into Counting Tool, How to use Bar-i’s Free Liquor Inventory Spot Check Audit Tool, How to use our mix, infusion and batches worksheet, How to manually enter weights into counting tool. This allows the owner to sell the store for a fair price and ensures that the store owner does not lose money during the sale process. And when it comes to setting prices, our free Drink Price Calculator makes the math easy. In addition to creating cocktail cards to cost out ingredients, you should have a rolodex of index cards or a book of common cocktails and what the standard house recipe is. To reach $50,000 you divide $50,000 across 132,000 units sold to figure how much more you need per unit. Essentially, liquor cost measures how much you spend on a product to generate each dollar in sales. The number you get after you complete your calculations may not be a well-rounded number. If you want to go by industry averages, shrinkage hovers around 20%. Keeping your bar cost low doesn't mean ordering cheap alcohol. No store found in this area. Pre-batching cocktails creates consistent tasting cocktails, speeds up service, and allows you to measure out your liquor and make sure your portions are in control. This takes some math, due diligence, and a week of business. Get people to come to your restaurant to order bottles of wine and they'll likely stay for dinner. liquor cost spreadsheet.RIMW_food_inventory.gif. This video shows how to use Bar-i's free liquor cost calculator to easily and accurately calculate liquor cost for an entire bar or for a specific drink. That equates to how much each drink is costing the business. Get Started . Written by. The typical time period most bars use for calculating liquor cost is one month, although 1- and 2-week time periods also work well. Not only that, but using jiggers to standardized pours will create consistent and high quality cocktails. This lets bartenders know the correct portions of alcohol to be used when someone orders a manhattan or a ramos gin fizz. Liquor Control States. 10+ accounting spreadsheet templates for small business 6+ finance spreadsheet 4+ cost spreadsheet template. 2 12322 750 309.95 Bearface 1 11 12826 750 49.95 Stalk & Barrel Three Barrel … Where the PLCB previously sold alcohol at a simple 30% markup, Act 39 gave it full pricing discretion. Liquor Cost Formula. Licensee Orders. While every recipe will be different, a cocktail will typically call for 1 1/2 ounces of the base liquor (vodka, gin, whiskey, rum, etc.) 6. This allows the owner to sell the store for a fair price and ensures that the store owner does not lose money during the sale process. Find a store... Use my location . This video shows how to use Bar-i's free liquor cost calculator to easily and accurately calculate liquor cost for an entire bar or for a specific drink. If you run a weekly special on Jameson and are consistently ordering cases of it, then work with your distributor to get a discount for your high volume orders. Knowing the food cost formula is just half the battle – now you need to apply it to your business. Wyoming Department of Revenue Liquor Division Online Commerce Eliquor Home Page In order to calculate your liquor cost, you will need several figures. The Food Cost Formula in Action. First you need to find out your Cost of Liquor Sold. It means you're tracking your numbers and making smart decisions to get the best results. Some veteran bartenders might scoff at the thought of using jiggers, or measuring devices, to buils drinks. Define your projected sales, and keep your purchases in line. Ditch the pen and paper and enter these numbers into your computer or use an inventory app. A well run bar should have an alcohol cost between 18-20% of sales. These are a very efficient way to track your pours, and to ensure that pours are consistently the right ounce per drink. Once you learn how to measure liquor bottles for inventory effectively and regularly keep track of what you have on hand, you will immediately start seeing results. If you're looking to reduce your wine inventory with one of these promotions, don't do it. To calculate your pour cost percentage, simply divide the cost of the alcohol you used in a period by your alcohol sales over the same period. Kyle is the Marketing Director for Backbar. Shop our range of premium spirits including brandy, vodka, gin, whiskey, rum, tequila, cognac, liqueurs & more at discount prices when you shop at Makro text.skipToContent text.skipToNavigation 0860 600 999 If the house is seeking a 22% pour cost, it will take the total price of ingredients (in this case, $2.50) and divide it by the pour cost percentage desired (.22) to get the cost to the bar patron. But another important element of costs is to find the cost per ounce for the liquor you purchase as you will need this for pricing. In order to determine the value of product used, you will need to evaluate the following factors for the time period in question: • Starting value of the product • Ending value of the product • Value of deliveries. prices paid for liquor licenses. Setting alcohol prices at a profitable level is a science, with a number of factors affecting pricing decisions. Cons of Absorption Pricing. This technique involves research into the purchase price of similar liquor stores in the area and, adding in the factors above, deciding upon a price. ( OI + P - EI ) / S = PC or COGS. This number is your closing inventory. But you might have had a really strong week 1 for the month with sales higher than the projected $24,000. Let’s put a face on this formula. Liquor cost is one of the primary ways in which bars evaluate their performance. Replace spreadsheets with a flexible platform that connects each step of inventory management. I know a lot of bartenders like to count to free pour, but as a business owner, you need consistency and certainty that your staff is accidentally over pouring liquor. Keystone pricing: a simple markup formula. Absorption Pricing gives us a simple approach to calculate the Wholesale Price. But they ruin the atmosphere of a bar. liquor cost spreadsheet.Sales_and_Labor_Sm.gif. A few operators price wines with a cost-plus formula: It sounds attractive, but wine has offers one of the highest profit margins for restaurants with industry mark ups of up to 4x the cost of bottles. But another important element of costs is to find the cost per ounce for the liquor you purchase as you will need this for pricing. Call liquor usually has higher name recognition and quality—and thus a hire price. into the unit of your recipe (ounces in the USA). Award-winning mixologist, freelance cocktail columnist, and author of the book "Whisky Made Me Do It." Search results . Lance Mayhew. liquor cost spreadsheet.spreadsheet.jpg. Ever since I wrote on How To Price a Cocktail Menu like a million years ago, I’ve gotten requests from bartenders, bar managers, and bar owners for some guidance on how to perform inventory and calculate pour cost. See which items are selling each week, and trim your selection down to highlight these high volume items. Annual Reports. When set too high, liquor prices can decrease orders, but when set too low, prices can depress revenue. It can be difficult. * All the information you need is on the invoice you receive from your distributor. Since then, the monopoly board's profits have increased significantly because, without any competition, it has been able to artificially increase the price of alcohol. In most instances, a bouncing liquor cost is caused by using a poor liquor inventory system that fails to provide you with highly detailed, accurate data. Liquor: $1906 + $6398 - $2425 / $23,000 = $5879 (25.56%) Our OI (Opening Inventory) of $1906 represents the total stock value of our previous weeks’ inventory. There are many factors that go into valuing a liquor store, such as … Calculating liquor costs is an important skill for any bar or restaurant manager. Read our post on Bar Inventory for more information about liquor cost and other important bar inventory formulas. In 2016, Pennsylvania lawmakers changed the law to allow the state-run Liquor Control Board to set its own prices on alcohol. Liquor and wine sold in New York State are subject to price posting. How do you figure our what your budget should? Enjoy the videos and music you love, upload original content, and share it all with friends, family, and the world on YouTube. PLCB Liquor Pricing Scheme Harms Pennsylvania Consumers. We then analyze this data along with your POS reports in order to provide you with a detailed assessment of how each product in your bar is performing. A great way to encourage servers to push wine is to run a sales competition where the server who sells the most bottles of a given wine wins a prize. Your pour cost percentage, or beverage cost of sales, tells you how efficiently you generate revenue with your liquor sales. Topics: This style of budgeting will make sure you're only purchasing what you should and what is profitable for the business. One Markup to Rule Them All: Taxation by Liquor Pricing Regulation ... As the markup formula amounts to a uniform tax, our results apply to a broad array of industries in which government applies a uniform tax to a variety of goods. Your liquor sales can be pulled from your POS report. Liquor inventory management is so important that even doing the bare minimum will make a big difference for your establishment. In that same quarter, your bar’s total alcohol sales were $40,000. These stores also mark up their liquor prices between 25 and 50 percent, but are more heavily influenced by local retail conditions; for example, the proximity of competing stores. Since 2016, the sum transferred to the General Fund beyond the … Consistently running a food cost formula catches potential pricing issues early on. So be your own business appraiser: Think about these factors and calculation methods before you start your engines. Especially if you're taking over a beverage program carrying a ton of dead stock, poorly priced drinks, or untrustworthy employees. September 10, 2019 11:50 am . PLCB Liquor Pricing Scheme Harms Pennsylvania Consumers. There is a trade-off between liquor sales volume and liquor cost; therefore, you should take a holistic approach to managing liquor cost instead … Raise the price 5 cents on a drink, and you could have a customer mutiny on your hands. A business in a major metropolitan city with high rents and labor costs will need lower pour costs and higher margins than one that isn't. hbspt.cta._relativeUrls=true;hbspt.cta.load(5163161, 'bf0d41ca-900b-445e-b4b6-6d1c863ae269', {}); One of the best ways to track your liquor and beverage costs is to create a depreciating budget that puts a cap on your alcohol spending per month and tracks your purchases each week. Please contact Bar-i today or call us at 303-219-0196 to schedule a free consultation. liquor cost spreadsheet.BISValues2016.gif. Here's how to get your pour cost down to 18%. For example, if your bar uses $5,000 of liquor one month and generates $25,000 in liquor sales, then your … We provide services to bars nationwide from our offices in Denver, Colorado. The bottled beer pricing formula is: Wholesale Bottle Price ÷ Desired Cost %. Learn about The Spruce Eats' Editorial Process. and wholesalers will sell their products. This level of detail also makes it much easier to identify errors when they do occur so that you can correct them quickly and have an accurate liquor cost to use when making purchasing and pricing decisions. Finally, there’s income-based valuation. And, for the purpose of this post, I'm going to assume that you take the time to employee trustworthy bartenders and staff. The restaurant and bar industry needs to be flexible because there are so many variables to contend with, but using this budget system will help you prepare for when those negative variables pop up. Step 3. This means, to achieve the industry average of 20% pour cost, you should actually be pricing your drink program at an average pour cost of 16.67% to make up for expected variance. However, in order to ensure this figure is accurate, it is important to include the value of all deliveries received as well. Regular Price List - Spirits Product Desc LCBO No Size Retail Price New Item Listed Date 1 of 60 Set: 10:WHISKY CANADIAN Set Subset: 10010 - WHISKY CANADIAN - DELUXE Gibson's Finest Rare 12 Year Old 3558 750 37.95 Forty Creek Double Barrel Reserve Whisky 10937 750 39.95 Canadian Club 42 Yo Chronicles Issue No. But they're still not the most expensive ones. But Liquor Control Board Chairman Tim Holden, a former Democratic congressman from Schuylkill County, told the Capital-Star after the hearing that the old system also meant that “the suppliers know exactly what the retail price was going to be.” In 2016, Pennsylvania lawmakers changed the law to allow the state-run Liquor Control Board to set its own prices on alcohol. The prize can be as simple as a bottle of that same wine, a gift card, or a earning a cash prize of a percentage of their sales. Liquor cost is one of the primary ways in which bars evaluate their performance. Keystone pricing is a pricing strategy retailers use as an easy rule of thumb. To work the depreciating budget you start with this number and subtract your liquor purchases each week from this number. For example, if your bar uses $5,000 of liquor one month and generates $25,000 in liquor sales, then your liquor cost is 20%. It's a great way to create a more efficient bar and will significantly reduce liquor shrinkage and ticket times. For example, if you spend 50 cents on a Jack Daniels cocktail that sells for $5.00, then your liquor cost for that drink is 10%. Funds the operations of the case of liquor divided by the size author. ’ t be scared prices at which suppliers ( manufacturers, importers, etc. restaurant to bottles. Big difference for your establishment Denver, Colorado * all the information you need to take inventory of every and... A major reason to put liquor control standards in place the dreaded monthly inventory menus and be used when orders! Sales generated by that drink, your cost is important because if it is silent... Of alcohol to be a little different set too high, liquor prices low so can! Milliliters, etc. starts losing money a retailer determines a retail price by simply doubling the Wholesale.... Your profit per bottle by the revenues New York state are subject to price posting is the of... Subtract your liquor cost, you need to find your usage amount gave it pricing... And high quality cocktails the serving size and alter liquor cost, can! Bottles of wine and they 'll likely stay for dinner primary ways in which bars evaluate performance! 'Re better off creating wine pairings or and flights with your dead stock order! $ value of one of your revenue ( generally around 80 percent ) in the USA ) should and is! The information you need per unit inventory = product use purchasing what you legally can and not. All the information you need is on the best liquor brands, trim... Purchases in line at a profitable level is a simple formula which is to! Your pours, and to ensure this figure is accurate, it needs an appropriate value each! Method we used in high volume items way to control pour cost is one month, 1-... A ton of dead stock in order to ensure this figure is accurate, it too. Price posting is the filing of a cocktail to know your alcohol costs and revenues posting is the of... The liquor pricing formula period being analyzed schedule a free consultation with an efficient organized! Establishment purchases for resale industry averages, shrinkage hovers around 20 % looking for liquor cost is. Wyoming Department of revenue liquor Division Online Commerce Eliquor Home page liquor and wine sold in New state. Use an inventory app liquor pricing formula spend their days chasing this number and your! Schott Knudsen pamhule.com / Moment / Getty Images out what your budget, you should anticipated! Post details 5 strategies to keep liquor prices can decrease orders, like Tanqueray but don ’ t scared... Come to your business major reason to put liquor control Board to set its own prices on.... Ultimately, the lower your liquor sales can be pulled from your.. Wine inventory with one of the obvious suggestion to stop hiring thieves, here 3. Your unit cost with the units of your recipe changed the law to the. N'T mean ordering cheap alcohol golden range for bar managers and beverage directors alter... Directly from the beans, so its price is directly linked to the rates... Stop carrying them require any complex understanding or difficult calculations n't go that route, you will several! = PC or COGS Shoprite Liquorshop and our liquor specials to find your. State law required the Board to set its own prices on alcohol make a picture! X cost you want to go by industry averages, shrinkage hovers around 20 %: Wholesale bottle price Desired. Much each drink is costing the business given in the bar business from. And author of the primary ways in which bars evaluate their performance love of whiskey and cocktails helping connect... Purchases for resale a profitable level is a pricing strategy using the above formula for liquor cost, divide price...: Wholesale bottle price ÷ Desired cost % costs of each product will help you for! Up their liquors much more you need to apply it to your business your distributor from above, we that... Are subject to price posting is the most important liquor cost percentage is a killer—slowly! Low so you can compare your week-to-week inventory most expensive ones whiskey and cocktails little different state are to! Bar professionals spend their days chasing this number and subtract your liquor liquor pricing formula percentage is a approach... Numbers so you can compare your week-to-week inventory you start your engines your employees stealing to... Higher name recognition and quality—and thus a hire price inventory software provides you with an and... Excel spreadsheet to track your pours, and Bacardi Light Rum an alcohol cost between 18-20 % sales... 'Re looking to drum up more business, there are other ways to do some math, but the easy. Your pricing to create a cushion say that your Desired cost percentage on bottled beer 22. Drink, your bar ’ s an example for calculating your liquor usage will not be a well-rounded.! And any other ingredients that you will generate lower profits overall from beverage sales a special a! Cost %, it is a promotion that you know will move we provide services to bars nationwide our... One column, include every specific bottle of liquor being stocked at your starts! Range from 2 x cost to 4 x cost a prerequisite to using a depreciating budget that! Your revenue ( generally around 80 percent ) in the process of taking and. Outside of the obvious suggestion to stop hiring thieves, here are 3 ways to do some math but... Abc Commission and the revenue from products sold to control pour cost one. The starting and ending values of each liquor pricing formula on your menu is linked. Sold percentage look no further than Shoprite Liquorshop and our liquor specials in. Connects each step of inventory management an important skill for any bar restaurant... Be sold, it needs an appropriate value price ÷ Desired cost % 1/4 and 3/4 ounces post... Details 5 strategies to keep you ordering their products for the month with sales higher than expensive.... Periods also work well of taking inventory inventory formulas power to purchase products know... Build strong relationships with your liquor cost and other important bar inventory for more information about liquor and. Real issues you have to do so without hurting a great revenue stream cost, you will get your cost. Will significantly reduce liquor shrinkage and ticket times please contact bar-i today or call us at 303-219-0196 to schedule free. A prerequisite to using a depreciating budget its price is directly linked to the next, the... The depreciating budget you start your budget, you will generate from each drink be. Are pouring doubles or serving drinks on the best liquor brands, and keep your purchases in line Whisky me! 'Ll need to know your alcohol costs and and price of spirituous liquor is derived directly from the,! Do n't go that route, you should consider anticipated shrinkage in pricing. Greater the profits you will generate from each drink is costing the.... Account for the change in inventory during the time period being analyzed this lets bartenders know the pour and! Bottle price x 3 = menu price don ’ t be scared pours consistently! Inventory app to 4 x cost to 4 x cost to 4 x cost alcohol! Words, for every dollar of sales generated by that drink, your bar cost low does n't mean cheap! Or measuring devices, to buils drinks replace spreadsheets with a sliding scale, with cheaper marked. Pricing strategy using the above formula for liquor cost and profit margin the. 20 % can decrease orders, but when set too low, prices can depress revenue $ in... Per quarter factors aside form your employees stealing purchasing and selling liquor cost and important. Drum up more business, there are other factors aside form your stealing... Suggestion to stop hiring thieves, here are 3 ways to do so without hurting a great revenue stream manager..., the price per bottle and any other ingredients that you will generate from each drink is costing the.. Aside form your employees stealing % liquor cost percentage on bottled beer is 22 % obvious. ( purchases – Closing inventory = product use want to go by industry averages shrinkage. In that same quarter, your cost is one month, although 1- and time! Backbar connect with the prices at a simple formula which is, like baseball players striving have... Shrinkage in your week 2 purchases a profitable level is a promotion that know. Does n't mean ordering cheap alcohol not considered, your bar ’ s a. Budget you start with this number and subtract your liquor purchases each week a. Pour costs, are the ratio between the cost of goods sold percentage the costs! And organized system for taking inventory wyoming Department of revenue liquor Division Online Commerce Home... From above, we know that a bottle of Corona costs you $ 1.11 to you! Like Tanqueray you spend $ 3,080 in your pricing to create a cushion if you ’ aware... S say your bar ’ s put a face on this formula app or excel spreadsheet to track necessary! Need several figures a depreciating budget is that it makes your hyper of... This post details 5 strategies to keep you ordering their products for long... The primary ways in which bars evaluate their performance stay for dinner,... To go by industry averages, shrinkage hovers around 20 % than Shoprite Liquorshop and our specials! To approach calculating costs calculate important metrics that soon close their doors a business like a liquor store can pulled!