Liquor- the cost and the profit

Published date: 1/17/2018 - Read count: 24

Nowadays, many restaurants open bar counter or serve more drink style to generate more revenue. So to understand and to analysis throughout the liquor cost also known as COGS (cost of goods sold) is crucial to every successful restaurant.
Why don’t we dive in the formula to calculate the liquid cost?

So what is 30% saying? I’m glad you asked. It means for every dollar you spend, 30 cents go for the liquor, and leaving you a gross margin of 70 cents or 70%. So to compare with the gross margin of food, the labor needed to make and deliver each drink is significant less than each menu item.
It also explains why your staff might see the profit of selling alcohol and cheat the owner for dollars. Here are some theft preventions to minimize the accidents happen.

Counting: appoint value employees/manager inventory to count and record the inventory to provide accuracy of bottle usage and stock value.
Sales revenue: keep track bar inventory to see any difference between your purchasing dollar and the sales revenue
Duration: you should do these steps every week, especially after the weekend when chaos happen the most.
I hope those tips can be useful for the owner. If you have other useful tips, please feel free to share with us. Enjoy.