Question

There are even systems (we use BevNet) to track liquor cost and we can see if a bartender is giving away drinks. Imagine you have no computer system in your restaurant right now. A company coming in to implement a system would cost you about $100,000 for implementation, and an ongoing price per month based on the number of restaurants you have.

What are costs that you can track and monitor and improve upon so you could show the restaurant owner that you would get a return on the investment and the cost of the system will be made up? Make a list of the areas you will save money.

Thanks

Answer 1

A BevNet system will help to control costs and save money as follows:

1. Track and manage inventory of the liquor: It will track the daily outflow and inflow of the different variants and the actual consumption throughout the day. It will also assign safety stock levels and reorder levels to ensure that there are no stock-outs or excess stocks. The BevNet will efficiently manage the inventory levels to monitor consumption in real-time and help to avoid variances. This will reduce the cost of overstocking and business lost because of stock-outs.
2. Plan stocks and place bulk orders: An efficient system will help you track your liquor consumption pattern and generate reports to forecast sales. You can negotiate a better price from suppliers by giving bulk orders and breaking up the delivery of orders into small lot sizes. It reduces space required to stock inventory and the cost of managing the inventory plus you get better prices by placing a bulk order.
3. Analyzing stock through yield management: The system will define which drinks are used to make cocktails and which are used more than the other drinks. Yield management defines how much of each liquor you would need to make the final drink. This will help to place orders accurately by breaking the drink into the quantity of the liquors required with the quantities.
4. Automates entire system: It avoids under-invoicing, over-invoicing or in accurate invoicing. The order is put on the system will be served and will be invoiced. The chances of losses due to inaccurate invoicing is eliminated. It also avoids the need to run to the bar to place orders. The server will place order in the system and bar will make the drink and get it ready to serve on that table. It saves labor costs too. The repetitive entry of information is also eliminated.
5. Eliminates internal pilferage: The stock is efficiently monitored while in warding and while making the drinks as the portions are controlled. The chances of theft and pilferage are eliminated because every detail is fed into the system in the real time.
6. Daily and weekly reports: The system will generate daily and weekly reports, which help to forecast sales, manage inventory and plan future sourcing. It will also help you understand what needs to be added to satisfy the customers, for example, a drink may be more in demand and you can get the basic drink at a lower cost from another supplier but he sells only x amount minimum quantity. You can club orders from 2 months after tracking data and knowing your demand potential. You can get the liquor at a lower cost.
7. Helps with annual budgeting: System helps with report generation, you can budget for future sales and arrange credit lines if required. You can save cost by negotiating better credit terms in anticipation of the potential requirement calculated using the system

To conclude you can save costs on inventory by avoiding under or over stocking, you can reduce the paper work by having an automated invoicing system. The reports are generated in real-time avoiding any repetitive manual data entry work, the server also saves time as the drink is ready before he reaches the bar, the forecasting is accurate which helps to plan the credit requirement and stocks, it helps in efficiently sourcing at the lowest prices.