How often should a bar take inventory?

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When it comes to the optimal frequency of bar inventory counts, there is no exact science. This must be dictated by your bar’s specific needs and the objectives you want to accomplish through the inventory process.

If a bar does not have an automated liquor inventory system that accurately measures what was poured vs. what was sold, inventory shrinkage can be as high as 20 %. Although this figure is typical in the industry, it is far from ideal. When you are missing 15 to 20 percent of your products, you’re squandering a lot of capital.

You can greatly reduce this amount and save a lot of money by performing inventory counts at more frequent intervals. This article will guide you through the bar inventory system to ensure you are running at an efficient capacity.

Why is inventory management important in a bar?

Liquor inventory is necessary because poor inventory management can lead to revenue losses and disappointed customers. 

Save Money

If you order too much liquor, it takes up precious shelf space and makes it difficult to store other items. Inventory is lost or forgotten when there isn’t enough room, and money is easily wasted. This can be avoided by taking liquor inventory on a regular basis.


Get personalized recommendations on bar and restaurant inventory management.

Avoid Excess Waste

Keeping track of your bar’s inventory is a delicate juggling act. On the one hand, you don’t want to run out of an ingredient, but you also don’t want too much of it. Err on the side of caution when making a buying decision. Whether it’s due to product expiration or taking up precious shelf space, having too much inventory will result in profit losses. Begin calculating the expense of wasting goods on the back end or front end and keep track of where the product is held.

Stock Adjustment

You can learn which products are more common with your customers and change your stock and purchase orders accordingly by conducting liquor inventory. This is a great way to figure out what the most famous cocktail ingredients and variations are. Knowing what the customers want results in increased productivity, less waste, and higher profit margins.

How do you maintain a bar inventory?

You now understand how to do bar inventory and how it can help you save money and time. However, you must take inventory on a regular basis to ensure that you are doing it correctly. You should also properly train your employees and test your operation.

Be Consistent

Take inventory of your bar on a regular basis. If you do it weekly, biweekly, or monthly, you should do it on the same day. Pay attention to the how and where as well as the when. Make sure you take your inventory the same way every time:

  • Begin in the same place each time.
  • Each time you progress through your bar, do so in the same manner (from front bar to back storage room, etc.)

Your inventory figures will be more accurate if you take inventory consistently.

Train Your Staff

Your employees are the final link between your inventory and its fate (benefit or loss). Staff training on the law of tenths, how to spot shrinkage, and the bar’s liquor inventory management processes can all go a long way to reduce shrinkage.

To begin or end shifts, have your employees visualize each bottle in 10 pieces. Then make them estimate and record how many tenths of the bottle are still left. They will record 0.5 if the bottle is half full. They’ll record 0.9 if the bottle is 9/10ths full and so forth. To measure consumption, you’ll have alternating beginning and ending inventory counts.

Next, teach the employees how to spot shrinkage. This usually entails noting the:

  • Breakage, spillage, and drinks made improperly must all be registered
  • The proper amount for a regular wine and liquor pour
  • Compensation policy

Finally, the bar’s inventory-taking procedure should be second nature to your employees. This includes the system of counting you employ as well as instructions on how to calculate consumption, pour cost, variance, and par levels.

The more your staff knows how their everyday activities impact the bar’s wellbeing, the more quickly they will notice areas where changes can be made to improve bar inventory.

H3: Experiment

Repeatedly ask yourself:

  • Where do you take your inventory and on what day of the week?
  • How many workers do you enlist for assistance?
  • What has proven to be successful in the past?

Keep track of what worked and what did not any time you take your bar’s liquor inventory. Obtain input from all parties concerned. Continually improve the method until it is perfect. It can take some time, but so does anything worthwhile. If you follow these measures, you will be well on your way to having a well-functioning beverage inventory management system.

What are the major types of inventory?


Weekly inventory counts provide the best and most accurate bar inventory example. Inventory is done on a weekly basis by a growing number of bars. There are several advantages to this:

  • Significantly improved accuracy – Since your employees do this every week, they will be very familiar with the operation. Errors are less likely to occur.
  • More regular data – Getting data every week allows you to have a closer eye on the output of your goods and make it easier to figure out why others are struggling.

We strongly advise our clients to count their liquor inventory every week to save money. When you increase the frequency of inventory counts from bi-weekly to weekly, many bars experience a 5% rise in transparency. In general, a 5% increase in transparency translates to a 1% decrease in liquor costs.

If the bar produces $50,000 in monthly revenue, a 1% decrease in liquor costs equates to $500 monthly savings. Given the time commitment for each count, this should be a no-brainer.

Although the savings will be smaller for bars with a lower monthly sales volume, the money you save can still provide cash that can be invested back into your company to increase your bar’s overall efficiency. Incorporating a weekly inventory routine can help your bar significantly over time.


If you are using a basic inventory system, bi-weekly inventory counts can be efficient.

A bar manager counts liquor inventory. This is the longest time span you should consider for your inventory counts if your aim is to get the most value out of your bar inventory efforts (e.g., reducing shrinkage and increasing profitability).

When you use a longer inventory time, you are more likely to make errors, why numbers appear to be off is not as straightforward, and you are more likely to have issues with your inventory performance.

If you are going to do bi-weekly inventory counts, we suggest doing them on the same day of the week every time. This reduces the probability of errors by:

  • Ensuring that each count is separated by 14 days, which will minimize variations in the number of deliveries from one cycle to the next.
  • Increasing the accuracy of your procedure

Which Option Is Right for Your Bar?

If done correctly, bar inventory can be a very useful tool. To optimize their benefits, well-run bars count inventory at least every two weeks, and a weekly schedule is typically preferable. Based on the change you see in your results, you should be able to figure out the right frequency for your bar.

In general, we’ve found that adjusting your inventory schedule based on efficiency and volume is the best way to go about it. When deciding the frequency of your inventory counts, you should work closely with your team. This is best achieved by reviewing inventory results with your team at a daily meeting so that they are aware of how well they are meeting the objectives you set.

A collective approach is the most successful way to get workers to get interested and motivated to reach inventory targets. Setting up an incentive program that offers specific incentives when inventory targets are met is a great way to make inventory counts more enjoyable!

FIFO Inventory vs. LIFO Inventory?

First in, first out (FIFO)

The oldest inventory system is the FIFO system. For most businesses, the FIFO approach is the traditional inventory method. Because of inflation, FIFO results in lower-cost inventory. This method consists in disposing of assets purchased or acquired first before disposing of newly acquired inventory.

Last in, first out (LIFO)

LIFO (last in, first out) is a more recent inventory cost valuation strategy (accepted in the 1930s) that assumes the newest inventory is sold first. Stock has a higher cost due to LIFO.

Which is better?

To determine the relative value of LIFO and FIFO inventory costs, examine how your inventory costs change:

  • If the inventory costs are rising or are expected to rise, LIFO costing is a safer option since the higher-cost goods (those bought or manufactured last) are deemed sold. As a result, prices rise and income falls.
  • If the reverse is true and your inventory costs are declining, FIFO costing might be preferable. Since prices typically rise, most companies prefer LIFO costing.

How do you classify inventory?

The term inventory refers to the stock on hand at any given time, which includes raw materials, products in the manufacturing process, and finished goods. The importance of an inventory for accounting purposes is to determine the correct profits for a given period. Inventory plays a critical role in determining a company’s profit margin.

Raw Material

Basic materials that have not yet been committed to production in a manufacturing firm are included in this category. Raw materials are bought from businesses and used in manufacturing processes. The aim of keeping raw material inventory is to decouple the manufacturing function from the purchasing function so that delays in raw material shipments do not affect production.

Stored Goods

This category contains items that are accessories to the main products created for sale. Kegs, bottles, glasses, and crates are a few stored good examples at bars. These spare parts are usually purchased from outside sources.

Finished Goods

There are finished items that are available for purchase. The aim of finished goods inventory is to decouple the manufacturing and sales functions such that no goods must be produced until they can be sold.

How do Bars track inventory?

Bar inventory management essentially consists of counting anything you have in stock – and then counting it again.

Then you take those figures and determine how much stuff you used over that time period, which is your inventory use. This number can then be used to measure a variety of other useful metrics. You can use these metrics to make profitable decisions.

Setting par amounts, reducing excess inventory, and assessing pour cost and pricing structure are only a few examples. Much of this is contingent on inventory levels. It is the single most effective way to improve a bar’s operating efficiency and profitability.

What is the best bar inventory software?

RapidBar App can solve your inventory issues. The app, which has POS integration, extends the capabilities of your POS inventory system whilst allowing batch recipes for precise stock control and automatic daily sales reports.

Stock counts are also completed quickly thanks to a Bluetooth scanner via the mobile app. This enables you to monitor draft beer, directly import new items from your database, and receive comprehensive inventory variance reports for each commodity.

RapidBar enables you to identify underperforming or missing stock in your bar in real time and act before things get out of control. Best of all – the software is fully paperless. Increase your profit margins with RapidBar and keep your storage room topped up every day of the week. Download the app now and book your free demo here!