Steps to Master End Of Year Inventory for Bar Owners

Hello and welcome to the Bar Business Podcast , where we help bar owners increase profits , attract loyal guests and simplify operations so you can avoid burnout and finally enjoy your life outside of your bar . I'm your host , chris Schneider , the Bar Business Coach .

Every Monday , we do a short episode to give bar owners a challenge for the week One simple project that shouldn't take more than an hour that can improve your bar and your profitability . So our challenge this week is to prep yourself for your end-of-year inventory now .

Now , for many of us , end-of-year is the only time we're going to count everything in our bar , and so not only do we have a large inventory where we have to count everything , it's some of the stuff we haven't really paid attention to for the last 12 months , and so , with the craziness that we're going to have the next couple of weeks , now is the time to

create a plan and to start working on making that end of year inventory a little bit simpler .

End of year inventory obviously this is one of the most important finance tasks we do throughout the year because , from a financial point of view , that end of year inventory is going to be the final determination of what our cost of goods sold for the year , which means it's , in part , one of the final determinations of what our revenue was for the year , one

of the final determinations for what our taxes will be , even because our profit determines our taxes . Our profit is determined by our cost of goods sold . End of year inventory , from a financial perspective , is one of the most important things we do at the end of the year .

It ties together everything and allows us to generate our statements and understand how our business performed in the prior year . As I mentioned , end of year inventory tends to be a large task , so the earlier we get ready , the better off we are .

And the whole challenge this week reaction steps are really there to give you a carefully structured way to make sure that when you get to that end of your inventory you have the most efficient time possible doing it , because it's going to take a while and it's going to make you angry , but the more efficiently we can do it , the easier we can make it when we

get there . You angry , but the more efficiently we can do it , the easier we can make it when we get there , the better that experience will be , even though it will still be terrible . So what are our goals for this week's challenge ? What are we trying to accomplish for end-of-year inventory ? We're trying to create an inventory plan .

We're trying to make sure that our count is easy and efficient and we're going to look at how we're going to order over the next few weeks in order to make that inventory as easy as we can , understanding that we can't stop ordering altogether , but we can .

In the way that we order and the way that we restock , especially when we get towards New Year's , the way that we order and the way that we restock , especially when we get towards New Year's , the way that we're restocking things behind our bar , can have an impact on how easy it is for us to do our inventory .

So there are four action steps for this week . First of all , determine when and how and who is going to do your end of year inventory .

Personally , I was always closed . January 1st , have a giant banger New Year's Eve , close the next day , sleep in till like three or four , wake up , run back over to the bar , count stuff for a few hours , have a beer , go home . That was my New Year's Day for years . But you need to know I normally did it in a year inventory .

I'd have my GM and my kitchen manager come in with me and my assistant manager , depending on the store and what our leadership structure was there .

But I would have everybody meet up and we would just count Now , regardless of whether or not you're going to be closed January 1st and you get to have that wonderful , you know , kind of relaxing time to do your inventory or not .

Now is the time to figure out who is going to be there January 1st when you're going to do your inventory and how you're going to break it up . So , like I said a lot of times , I'd have a number of people there .

I'd have my kitchen manager there to count all the food items , I'd have my GM there or my assistant manager , you know , counting things in storage and behind the bar . We would break the bar up into zones or areas and everyone would just count their area and then we'd put it all together .

It makes it quicker , it makes it easy to determine who that's going to be and how you're going to break up the work . Your next action step is get everything organized . You want to make sure that the count's easy , and so when I say get everything organized , I don't mean how you're counting , I mean what you're counting .

A lot of bars will have things scattered around . We'll have different products stashed in different spaces . You think of something like to-go boxes that you probably haven't counted but you probably should count for in different spaces . You think of something like to-go boxes that you probably haven't counted but you probably should count for in your inventory .

They may be scattered all over your box . So you want to plan in place , get that all organized , to get everything into one or two locations not 15 , to make it easier to count , and that way you also don't skip things .

You know , one of the biggest problems people run into with inventory it's not that they count wrong or that they're intentionally trying to steal or anything like that . It's that there's stuff stashed somewhere and they don't realize it and then it doesn't get counted . So get all your stuff together .

Now the third action step is going to be determine how you want to restock and how you want to manage that inventory going into New Year's Eve and after New Year's Eve . So New Year's Eve for me was always a big night and I had them stock normally on the 30th of December , but after New Year's Eve I had them stock nothing , nothing .

Honestly , I mean my managers and I would stock after we counted on New Year's Day . The reason for that is when people stock things , they break up cases . They're pulling bottles out of cases . I don't want to count bottles , I want to count cases . So I never had people restock New Year's Eve .

Maybe that works for you , maybe it doesn't , but have some direction for your people restock New Year's Eve . Maybe that works for you , maybe it doesn't , but have some direction for your team going into New Year's Eve of hey , here's what we want to stock .

Another thing I would always do as we got close to the end of the year is I would tell them hey , we had shelving and storage right under the bar . We had storage in the back , liquor storage , and then we had stuff that was on the bar .

Generally every night one of the tasks would be to take stuff from the storage in the back and to restock what was under the bar Towards the end . You see , we wouldn't do that . So I'd have full cases in the back and we'd try to drain that kind of under counter storage down as much as possible again to make it easier for us to count .

And the fourth thing you want to do is check all your count sheets . However you do your inventory whether that's an Excel file or whatever program you're using to do your counts make sure all the data there is , make sure every item you carry is actually listed on those sheets , because if it's not , you're gonna run into a problem .

You won't be able to count things . You'll be handwriting in different items in different places and at the end of the day that makes it hard to make sure your counts and everything are good and it makes it hard to stay organized . Check all your count sheets and every item that you carry to make sure that matches up .

And while you're doing that organization in step two , that's a great time to also be checking those sheets . So four active steps , just to go over them once more . Once more determine how , who and when your inventory will happen . So how is it going to be counted Like what areas ?

What are you counting , who's doing it and what time Literally time and date that it will happen . Get everything organized so that you have less stuff in less places . Get all your like things together .

Provide your staff with direction on how you want them to stock differently the last week of the year and or New Year's Eve , so that it makes it easier for you and your managers to count and check all your account sheets and make sure that they are actually active . That's going to wrap us up for today .

To get even more out of our weekly challenge , make sure you join the Bar Business Nation Facebook group . There's a link in the show notes . I make a thread there every week so we can share our challenges and successes and improve our bars together . Until next time , have a great day and we will talk again later .