2024 Planning & Goal Setting for Bar Owners: Boost Profits & Team Performance

We are getting towards the end of the year For those of you in the United States , obviously , we have Thanksgiving this week , so the time between now and New Year's is getting shorter and shorter and shorter , and in the bar business , one thing that absolutely happens to us is that December tends to be a very busy month .

We have people having holiday parties , we have the holidays for ourselves and for our families . We have New Year's Eve , which for most bars tends to be a pretty big night . So we have limited time and we have a lot of pressure to get ready to move into the next year .

And in order to properly move into the next year , we really need to focus on five areas that will prepare us for 2024 . Those five areas are bookkeeping , team management , marketing your physical plan and setting big goals . So today we're going to cover those five areas .

We're going to talk about them in some depth and give all of you both some ideas on what to focus on as we get into the end of the year , where you need to worry about your business , what is important to figure out as we're moving into the next year , but also how to take a good look back at the year that you have had so far .

So , with our five areas , the first one we're going to start with is bookkeeping , and this is all about getting your numbers in order , because it's really important that , as we end out the year , you have a really good idea of where your numbers are , where your business is , what is going on with the dollar and cents of the business , and we've talked about

many times . The main reason that anyone is in business is to make money . So if we're making money , the most important thing year to year is our numbers , because our numbers reflect what amount of money actually goes into our pockets as bar owners .

Now , the first thing you have to do to get your bookkeeping in order and to really be able to close out the prior year is to make sure you're caught up on things . You need to be as current as possible with your bookkeeping , with all your numbers .

Not only is that essential to understand the prior year , but it's also essential to be able to forecast and to begin to think about what the next year looks like . And so , bottom line with bookkeeping first thing , make sure you're caught up , make sure that you're at the point where you're crossing your T's and dotting your I's .

Obviously , we have a little bit more than a month of the year left that you're going to have to work in there , but make sure everything is up to date Because with all the holidays that happen at the end of the year , with New Year's Eve , with everything else , trying to do your books at that point in time is going to be very difficult .

So the more that you can be caught up now , the less the holidays , the less that busy season is going to affect you and your business . Now , beyond getting caught up , one of the most important things to do with your bookkeeping at the end of the year is to make sure that all your payroll and contractor paperwork is properly completed .

And so when I'm saying payroll and contractor paperwork , make sure everything is how it has to be . If you use a payroll service , that should be really easy .

But if you don't use a payroll service , you need to make sure that you are set up and prepared , if you're in the US , to issue your W2s , because that happens really quick once we get into January , w2s and all the payroll records are due to your employees by January 31st .

So if you don't have this ready to go , if you don't have all your ducks in a row going into January , it can be very hard to produce all the needed documentation for your employees to be able to do their taxes Now .

Obviously , if you're using a payroll provider , they should be handling most of this for you , but you need to make sure that they are depending on the payroll provider you use . They might take care of everything for you .

They may not take care of everything for you , and there are things like the FICA tip credit that not every payroll provider is going to fill out that form for you and get that prepared , and if they're not , obviously in the United States , it's a huge deduction from your personal taxes . So it's important that you make sure you get that filed .

When it comes to your contractors those people that are doing work for you but are not on your payroll you need to make sure you have all the right documentation from them , because you're going to also have to send them a tax form a 1099 , by the end of January . So you need to make sure all those ducks are in a row too .

So , with all your payroll , with all your contractors , make sure you have your hours recorded properly , make sure that you have the documents that you need to file , the forms you need to file , ready to go , and make sure that , if you're using a payroll provider , that any gaps in what they file you are ready to get prepared and filed on your own .

Now , obviously , this is going to change state to state . This is absolutely going to be drastically different country to country . So , as I have said many times , I always advise find someone local to you that is a taxpayer that can help you through this process .

But because most of those deadlines are in January or in January rather , you need to make sure you get that done now and that you're making sure that you get everything ready to file now . Obviously , you won't have numbers , but you at least need to identify what things that absolutely must happen , depending upon your payroll provider and where you're located .

The other thing with bookkeeping that needs to be done basically now , but in the next couple of weeks for sure is to look at your inventory and your pricing .

Obviously , end of year inventory is going to happen December 31st or January 1st , but to the extent that you can look at your inventory , look at your pricing , look at your menu mixes , start to set up your menu engineering Really . Look at taking a full analysis of your menus , and that's food menus , cocktail menus .

That also goes to things that aren't on menus . So while we may have a cocktail menu that we change every quarter and that we do menu engineering on on a regular basis , we may not do that just for every single vodka that we have in house .

It's really important at the end of the year that you take the time to step back , look at that and analyze things From a psychological perspective . When it comes to raising prices , one of the easiest times of year raised prices is January 1st .

People kind of expect that Now , with the rampant inflation that we've had the last few years , people are a little bit less price conscious and less affected by changes in price than they were previously . We all know that , in addition to inflation , the economy has not been getting better .

So we do have patrons that are price sensitive and by raising those prices just cleanly at the beginning of the year , it makes things easy .

So look at every single item you sell and make sure that your pricing is where it needs to be to hit the cost percentages that you want to hit , based upon your model Now , we've talked about it before but the optimal prime cost , in my opinion , because I think every bar should be able to put 15% on the bottom line and to put 15% on the bottom line ,

you're looking at a target on your prime cost of 55% , so anything that's going to allow you to maintain and hit that 55% . Look at those prices , these prices , where you need to , and now is the time to start setting that up so that you can forecast it .

You can run models , you can use your menu mix percentage to really start to play with what is going to get me that 55% prime cost moving into the next year .

The other thing that we want to look at as far as inventory and pricing is what delivery services we're using . So a lot of us nowadays we're using Grubhub , we're using DoorDash different delivery services and obviously those come with a steep cost , and we've talked about it before , some of the upsides and downsides to using those services .

But if you're using those , when you're analyzing everything at the end of the year , when you're looking at your prices , when you're looking at your margins and everything , delivery services is a key piece to keep in mind .

The other thing that you should be evaluating at the end of the year is any specials , any sales , happy hour specials , anything like that that you have that's going on on a reoccurring basis . This is the time to evaluate that and say , does that make sense ?

Because , again , a great time to change things where your patrons are less likely to complain , is the first of the year .

Additionally , while we're talking about numbers and bookkeeping , this is a little bit separate from that , but also important you should look at your suppliers , your distributors , evaluate all your relationships that you have with different vendors , whether it's your POS system , your merchant services , processing your food , your liquor , your beer .

Wherever you have the ability to look for new suppliers , do it . See if you can cut a couple points here and there and get the same product for less money . The other reason to look at suppliers , distributors , folks like that is because at the end of the year , a lot of times , if you switch companies , you will get good deals .

For instance , right now , a lot of payroll providers . If you switch payroll providers this time of year , they will give you free W2s and they'll do your end of year taxes and everything for free , because you're switching right before the end of the year .

Well , if that's the case that W2 package in the United States very commonly we're talking $200 , $300 , $400 for those end of year filings and for that end of year package and all the reports that you need If you can switch suppliers , switch vendors and save some money , it is worth considering .

But obviously , if we're talking about switching and trying to catch deals that exist this time of year , before the end of the year , we have about five weeks left . It's time to get on that now , once we get past bookkeeping . The second area that we want to look at as we're preparing for 2024 is your team . First , we have to look at where we are .

We need to understand our current state and then we need to look at how to improve . When we're talking about the team , the first thing we want to look at is where are we on KPIs ? Obviously , we have goal KPIs , but is most our team meeting those goals ? Are they not meeting those goals ? Are they far exceeding those goals ?

Because , frankly , if most your team is meeting those goals and it's kind of if you bell curved everyone on your team , they're all where your goals are and the top of that bell curve match up , so the majority of your people are all doing exactly what you expected them to do , then we're in a good spot .

Now , if you see most your people far exceeding the goals , that means that your goals for the prior year weren't stiff enough . If you see no one meeting your goals , that means your goals were too out there . They were unachievable .

So , with your KPIs , look at what you expected and then look at the reality and start to think about how those KPIs adjust going into next year , because one of the main functions of KPIs and something that we should be doing this time of year is working on employee reviews and essentially , with employee reviews , our main goal is to evaluate and rank our team .

Now , rank can sound a little brutal because we're saying you're number one and you're number 56 . But , to a large extent , ranking people is helpful in the employee review process . It's going to provide you with data , with real information by which to judge where your employees sit , rather than just relying entirely on how you feel about them .

Because , let's be honest , as bar owners , you will frequently have employees that are fantastic , that you don't particularly like , or that you really like but kind of suck when it comes to their sales and guest check averages and all those sorts of things . So it's time to evaluate and rank people and then to do employee reviews .

As important as it is to rank people and use your KPIs to drive your employee reviews , that soft stuff should come back into it . So we have the hard data the KPIs , the numbers , the things that we can measure and rank people easily but then we also have the soft areas that we're ranking people Personality , how they interact with guests , things like that .

Now , maybe if you have a strong guest review program , you can rank them based upon guest reviews , but we all know guest reviews are a little wonky in that they're either really really good , which happens very rarely , or really really bad , which happens more frequently .

So look at creating a holistic approach to your employee reviews where you're factoring in your core values and what you expect of your employees as people , in addition to their KPIs . The KPIs don't show teamwork . The KPIs don't show how much your team is living your core values day in and day out .

So when doing reviews , you need to create a system in your head that encompasses all of those things . Also , with employees , end of the year is the time to look at benefits Now . Obviously , if you're in the United States and you're providing health insurance , that's a whole thing at the end of the year .

But in general , regardless of what benefits you're providing whether it's retirement plans , some sort of telehealth benefit , pto or sick time the end of the year is when to evaluate that , because , just like with your customers being a little bit less resistant to change on January 1st , your employees are a little bit less resistant to change on January 1st .

Obviously , if your employees have a lot of benefits and you're going to grab those all the way , they're not going to be happy with you , but the time to change their benefits , the time to change how that's structured , how that works , is the beginning of the year , and that means now is the time to review those , review what you're providing , how you're providing

those benefits and what makes sense for your business moving forward . The final piece that we should look at when it comes to team management is reviewing your employee handbook and your training standards . So I know most of us have employee handbooks , most of our employee handbooks .

Let's be honest , as independent bar owners , we found something from a payroll provider . We found a template online . We changed some words . We made it our own and that's what we're running with . It's not a particularly great handbook and , frankly , those get updated a lot less often than they should .

So if you're at the end of the year , it's the time to review that . It's the time to tweak things that have changed since the last time you looked at that .

We've talked about it before , but with an employee handbook , one of the great ways to do that is to do it online , do it through a system like Google Docs , do it as a PDF in a shared drive folder where everyone has access to it .

But as you change it , it changes automatically in real time , so no employee can say well , I had a version of the employee handbook from five years ago .

Now , if you're doing it and you're just printing it off and handing it to people when you make changes at the end of the year , everyone needs a new employee handbook , and one way that you can kind of psych yourself into always producing a new handbook is to put the year of the handbook on the handbook .

So it would be employee handbook 2023 and we're going to update it to employee handbook 2024 and then distribute that to everyone that works for us in the bar .

Another advantage of that is when an employee says well , I have an employee handbook and it says X , and then you look at the cover and you go well , that's because it's 2022's employee handbook , not 2024's employee handbook . It makes it easier for them to understand that distinction . It also could help you avoid some legal troubles if something bad happened .

And in addition to handbook training standards , so any training that's happened that's changed , any training materials that's changed over the year that have yet to be updated . Now is the time of year to get in and do that .

It's also the time of year to think about how you want to train next year , changes you want to make to your training program , changes you want to make to your training standards , changes you want to make to the material or how people get trained or the process .

So make sure you're reviewing holistically how you train people and what you can do to improve that process and then publish those and get those out so that you're starting January 1st with a robust training program that has been updated . The third area we want to look in at the end of the year , as we get towards the end of the year , is marketing .

So with marketing , our goal should always be to say how can I gain more market share in the next year and to say how can I gain more market

share in the next year . We have to start by looking at what we did the prior year , what worked , what didn't . Where can we show that we had a good ROI and where can we not show that we had a good ROI ?

A lot of times , with print advertising , radio advertising , more traditional advertising , if you will , it's hard to show that ROI , but when we look at things like SEO and social media , it gets easier because there's more data available to us .

So as we're looking at ROI , as we're looking at what worked and what didn't , we need to evaluate how we've been treating social media , how we've been treating our SEO , and look at the strategies with social media . It's not just about ROI . It's about what got liked , what got shared With SEO . It's about how much traffic drove to our website .

So we need to look at all of those and how we can tweak them , improve them and build on the momentum that we have for the next year so that next year we get more market share , we get more eyes on our content , in addition to worrying about social media and SEO . Update your website . Don't kind of update your website . Don't look for some spelling errors .

No , update it . Make some real changes . Make it feel new and different , but still cohesive to your concept and part of your brand . And the reason to update your website is , as we all know , websites look old , quit .

If you search around on the internet you can find tons of websites that are still active from the 1990s , and if you pull up those websites and look at them , if you had a website that looked like that today , it would kind of be a joke .

Now , I'm sure none of us are using websites that are 30 years old , but there are plenty of people that have not changed their website in five years or four years or three years , and the advancements in website , in web design , in how people expect to interact with webpages on the internet , has changed drastically in the last five years .

So make sure you're updating your website . Make sure it is modern , make sure it has what people expect . Other place that you should look at your marketing as we're going into the next year is look at your merchandise . Look at your t-shirts , your hats , your hoodies , magnets , pint , glasses , whatever you have . Look at your merchandise .

Look at what sold well last year . Look at what didn't . Build off of the designs that worked . Build off of the styles that worked when it comes to shirts , hoodies , et cetera . Obviously , some styles tend to outsell others . Hold on that . Bring in more of what people are buying and get rid of what people aren't .

If you wanted to , you could even do menu engineering on your merch program .

There's not normally a reason to go that much in depth in merch because it's a smaller portion of what we sell and we're talking about thousands of dollars , tens of thousands of dollars , as opposed to , if we're talking about menu engineering food , where it could be two , three , four , five hundred thousand , or cocktails , where it could be hundreds upon hundreds of

thousands . But look at your merch . Figure out what's worked , figure out what hasn't . Tweak where you need to tweak so that you're entering that year with new marketing . Also , if you're going to come out with new designs , now is a good time to start thinking about that .

Now is a good time to start thinking about how do I want to design my merch for 2024 , to improve it , to make it better , to have better designs on things . The fourth area we want to look at as we're getting ready for the change in years , is our physical plant .

So when I say physical plant , I mean you're building your interior , design , your equipment , because all of that is very important to maintaining a cohesive guest experience . If you want your concept to come across properly , the guest , your interior of your bar , must feel like that concept .

And for a lot of bars , whether you've owned a bar for 20 years or you purchased a bar that's been open for 20 years , a lot of people have bars that have looked more or less the same for 10 , 20 years .

And so think about your interior design , not necessarily your tables and chairs , which you can change absolutely and if they need to be upgraded , they should be but think about what you have hanging on the walls , think about how that all ties in with your concept , and think about small areas where you may be able to update .

Now I'm not saying you have to do all of this on January 1st , but start to get an idea in your head of hey , you know , I would really like new chairs for this area , or I like what's on the wall here , but it's getting a little dated , so I need to come up with a new plan for this and I want to make sure that we redo this wall sometime by March .

So set some goals with your interior design , but look for ways to update the physical feel of your building , because constantly , people are coming in , they see the same stuff . When they see change , it makes them feel better about the fact that your business is doing well , that you're growing and that you're changing with the times .

If you walk into a bar that seems like it's the 1990s , people will have the same reaction as if your website looks like it's from the 1990s . So make sure you're updating things . Also , when it comes to the physical plant , we want to look at our facility and where we may need to update our facility .

One thing that I'm really big on is when you talk about renovations . When you talk about not interior design , but more structural changes or redoing bathrooms , changing out your bar top . Rarely is there a reason to do all that at once , but you can plan each year to make a little change here , a little change there .

Maybe this year is your bar structure and bar top . Next year you're going to do a couple bathrooms . The year after that you're going to do a couple more bathrooms . The year after that you're going to do your kitchen . But start to think where your big facility spend is going to come this year and plan for it .

With any construction project nowadays there are delays , there are issues and it's cost more than you think it will . So plan all those in and then you can get with contractors and stuff and get contracted start and end times .

You can really build out what you need to do to improve your facility each year and don't again try not to bite off more than you can chew . Do a little bit every year and that little bit every year will , over a decade , cause huge changes in your facility .

Well , at the same time , not making it so that you have to take out another loan , not causing you to dig real deep in your profit and still making sure you can put money in your pocket while developing your physical location . The other thing that we want to consider physical plant-wise is equipment and maintenance .

So while everyone should already have a preventative maintenance schedule in place , I know we don't all we know that sometimes we forget about those things or we get a phone call from our HVAC guy and forget to call him back to schedule . So make sure that your equipment and maintenance is up to date .

Anything that you have a regulatory requirement to maintain think cleaning hoods , think fire extinguishers make sure that's all up to date . Now is the perfect time to go around and check all that and make sure that you are 100% compliant .

Thank you , if you need to then schedule people to come in , but make sure that all your preventative maintenance is planned out , that you have things scheduled for the next year and where you can schedule things out for the whole year .

Make sure you're in a spot where you've thought through your equipment , you've thought through the maintenance that needs to happen on it and you have planned that out properly , because that'll make the year a lot smoother .

And when you forget that your ice machine needs to be cleaned and have some preventative maintenance done on it and have all the parts checked every quarter , if that's already scheduled at the end of this year , next year , you don't have to worry about it until this time next year when you can schedule 25 . So definitely look at that piece .

The fifth thing we want to do as we're getting towards the end of the year is set our big goals for the next year . Obviously , before we set big goals for next year . We need to look at what our big goals were for this year . How did we do ? Where were we successful ? Where were we successful , why were we successful and why were we not successful ?

And then , once we understand what our goals were and those should obviously be based on your culture , they should be based upon your values , they should be based on the type of business you have and what you wanted to achieve then we can look at where we can push further . What goals do we have that we achieve too easily ?

What goals do we have that we didn't achieve at all ? Why did we not achieve those ? So look at your current goals for the prior year , assuming you had them . If you didn't , then skip that and just worry about setting goals for the next year . But we want to set goals that will drive our success in the upcoming year .

And this is the time to do it , because January 1 , we want to hit that ground running . We want to know what the blueprint is for our business for the next year on January 1 . Now , with all goals , we want to make sure they are smart , and smart is an acronym you will hear a lot when it comes to setting goals .

But smart stands for specific , measurable , achievable , relevant and time bound . So those are five things . Any big bet , any big goal we're going to set for next year needs to meet those five criteria . So specific don't say I want to make 20 grand more on my bottom line .

Say I want to make 20 grand more on my bottom line and we're going to do that by reducing our food cost by 2.5% , our labor cost by half a percent and our beer specifically draft beer cost by three points , because we've been having a lot of yield issues there .

So anytime that you're setting a goal , make sure that you're not just saying , hey , I want to do this . If you're Elon Musk , you don't say I want to go to Mars . Well , you do say I want to go to Mars , but then you set intermediate goals that get you to Mars .

So your big goal for next year may be get to the moon , because if you get to the moon , then eventually you can get to Mars . But you need to be absolutely as specific as possible with your goals . Your goals also need to be measurable . If your goal is be an awesome bar , that sounds great . I think we'd all love to be an awesome bar .

What the hell does that mean ? How do you measure that ? How do you actually achieve being an awesome bar ? So make sure whatever you put as your goals , that you can measure it .

Now , the third piece here of our smart acronym is achievable . So don't set a goal that you can't do . Set a goal that is reasonable . Set a goal that you can get to next year . Your goals also need to be relevant , so you could have a goal that's specific , measurable , achievable and time bound .

That you're going to run five miles every week , but you , as the owner , running five miles every week ? Yes , it's going to help your mindset , yes , it's a great goal for you personally and probably will energize you to help your bar more in the next year , but it's not at all relevant to your bar .

So make sure your goals are relevant to what actually we're talking about here , which is the business of your bar . And then you want your goals to be time bound . So we're talking about annual goals . The time bounds really easy it's by the end of next year , but make sure you have some time .

Maybe you have a goal , different goals rather , for quarter one and quarter two and quarter three and quarter four , because you want to achieve different things in each quarter and along those lines , if you're going to have a long term goal for the year , that by the end of the year we want to increase our bottom line from 12% to 18% , create step goals in

each quarter , create intermediate goals that get you to that big goal .

So , if we want to raise our bottom line from 12% to 18% over the course of the next year , well , after the first quarter we should be at 14% , and after the second quarter we should be at 15.5% , and after the third quarter we should be at 17% , and then after the fourth quarter we should be at 18% .

So , however you want to do that and it all depends on what goal you're trying to achieve but make sure with your goals . If you have long year long goals that you're setting and that's your time bound is one year set intermediate goals that are more achievable .

Give yourself a ramp up to where you want to be , because that will make it much easier to get there and it will help focus you and narrow what you're doing , what you're looking at day to day within each of those individual goal periods .

So , if you focus on those five areas your bookkeeping , your team management , your marketing , your physical plan and your big goals . You are gonna set yourself up now to have the best year you've ever had . Next year You're gonna set yourself up with all the tools you need to be successful .

You're going to give your bar the opportunity to do way better next year than you did this year . But you have to start planning now . There are five weeks essentially left in the year . There are holidays , we're busy , there are Christmas parties , there's New Year's Eve , there are all those things . So the time to start planning is now .

Now speaking of the holidays , speaking of Christmas , if you are looking for a gift to give someone that you know that is in the bar business or wants to be in the bar business , go down to show notes . Check out my book how to Make Top Shelf Profits in the Bar Business .

It is available in paperback , hardcover on Kindle and on Audible and there's a link in the show notes that can get you all that . It makes a perfect Christmas gift to give to your friends in the industry . Also , if you have not had a chance yet in the show notes , check out Bar Business Nation .

That's a Facebook group where we're trying to build a community of bar owners to all help each other . We're doing a monthly meet up there , so in I think it's three more weeks we'll have another meeting for everyone .

Get together , swap ideas , talk , really explore where everyone is in their journey and with their establishments and , of course , if you ever want to have someone on one time with me , if you're interested in exploring coaching and whether or not we can work together and we would be the right fit to help develop your bar and to make your bar better going in the

next year with things like setting goals or working on your marketing or working on your materials for your team , your training , standard , dream plan books , all of that . Go down to show notes . Schedule a strategy session with me . We can have a chat , see what we can do and how we can work together . With that .

Guys , I hope you have a wonderful Thanksgiving if you're in the United States . For everyone else , I hope you have a great week and we will talk again later .