Have you made these bar management mistakes?

The bar and restaurant industry is a risky place to be. Over 60% of new establishments go under in their first year; 80% by their fifth year. But we’re all still here because we love it.

Bar managers build successful businesses and call the shots on every aspect of a bar’s operations. Beverage directors develop innovative cocktail menus and create drinks for their guests that establish a love affair with completely new flavors.

But running a bar is hard work. Being responsible for so many aspects of a business is a lot of pressure—overlook the smallest thing, and you could see the numbers come crashing down in front of you.

That’s why we’re here. We’re helping bars and restaurants streamline operations so that you can spend more time on the important things.

It’s a bumpy ride. Here are some of the bar management mistakes you need to avoid along the way.

1. Poor Employee Management

Successful business management starts with the staff—you can’t run a good bar without them. Your establishment will live or die based on how your customers are treated and whether or not they feel comfortable in your space.

This responsibility falls directly on the shoulders of your employees, but it’s your job to provide them with the knowledge, ability, and tools to do so. Support your staff and they, in turn, will support your customers.

This means:

• Adequate training in every aspect of bar operations. Don’t just teach your employees how to do something, explain why it’s important and what impact it will have on the business. Properly trained staff will not only delight your customers but will help avoid shrinkage through loss of product, like theft and over-pouring.
• Set clear goals and expectations, and ask for your employees’ input when setting them.
• Irresponsible or unorganized scheduling will upset staff members. Talk to your team if you’re planning major schedule changes, and never spread them too thin.

• Don’t ignore internal problems—they won’t just disappear. If something’s going on with one of your staff members, you need to address it.
• Build a fun, exciting, and supportive work culture. Your employees will enjoy their jobs and reward you for it.
• Poor communication is the root of many business problems. Mistakes like failing to give proper feedback or insufficiently explaining tasks will leave staff feeling lost.

Download your free Guide to Bar Management eBook.

2. Losing Touch With Industry Trends

Are you aware of what’s popular in the industry? Do you know what cocktails people are looking for right now? Do you know why Old Fashioneds, Mezcal, Sour Beers, Nitro, Bitters, and tapped cocktails are trending?

One of the most common bar management mistakes is losing touch with industry trends, and this is an automatic loss of business. People love to get a taste of what’s hot, and if you’re not stocking it, they’re not staying. The easiest way to stay up to date is by reading relevant publications and following popular social media channels. We recently compiled a list of our favorite industry blogs—check out this roundup of the top 20 bar industry publications to follow.

It’s also a good idea to visit online forums (we frequent industry groups on Linkedin) and attend industry events in person in order to expand your network and stay in touch with what’s new. We recently attended the Nightclub and Bar Show in Vegas, and it was a wild couple of days (and super educational).

3. Poorly Developed (and Priced) Menus

A menu is one of the most significant and revealing aspects of any bar or restaurant. Often, we see beverage directors develop exciting and innovative menus only to neglect them during the following months, or even years. A menu carries massive weight when it comes to an establishment’s profitability and success—the nuances of your menu will have a substantial affect on your numbers.

Here are some important things to consider when designing and pricing a bar menu:

• Stock your bar with not only the right product, but the right variation and mix, while also keeping it simple enough to not overwhelm guests.
• Cater to both the style of your bar and the preference of your neighborhood and clientele.
• Consider the labor involved with each menu item, especially cocktails.
• Properly price each aspect of every drink, and ensure there’s a price balance across the menu, i.e. some items can be sold at or below cost, provided other items can make up the loss by being priced above the typical mark-up.
• Constantly monitor both top-performing and bottom-performing products, and where they’re situated on the menu.
• Consider including an additional happy-hour menu, or a rotating daily menu.
• Calculate and monitor your pour cost at the highest level of scrutiny.

When designing and updating your menu, allow your staff to submit cocktail recipe ideas. Narrow down the list to a selection of your favorites, and taste and tweak the recipes. Build your recipes with as many fresh, high-quality ingredients as you can, while also focusing on minimizing waste and maximizing profitability. With beer, put together a good mix of local beers, domestic beers, and international beers that cover each beer type. Your wine list will depend heavily on your menu, clientele, and price points.

4. Insufficient Marketing Efforts

Marketing your bar is more than just creating a Facebook account, and this is one of the most common bar management mistakes. Publishing irresistible #foodporn is important, yes, but marketing your bar is a multifaceted process that requires significant dedication.

• Commit to social media. Building a presence online is harder than it seems. It’s a platform to promote your discounts and events, of course, but it’s also a place to develop a strong and trustworthy brand identity. You should be connecting with your customers and potential customers and projecting an image of what your establishment is really about. And, of course, posting irresistible photos of your latest drinks and dishes is important. Use social media management tools like HootSuite and Buffer to maintain an active presence while saving time.
• Offer loyalty programs and discounts. These should be distributed both externally—in your local area and on social media—and within your bar—on the menu and through your staff.
• Create an email newsletter. This is another channel for you to extend your brand identity, reach out to consumers, and promote discounts and deals.
• Set up a Google+ account. When you search for a business on Google, Google Knowledge Graph pulls up relevant contact and business information in the right sidebar, so registering your business with Google+ creates more online visibility and trust.
• Connect with industry experts. Reaching out to industry bloggers is a great way to get your name out there. You can offer special discounts in exchange for promotion of your establishment, or offer to write an “industry expert” guest blog post for their publication.
• Sign up to discount websites like Groupon and LivingSocial, and create accounts on delivery sites like GrubHub (if it’s appropriate).

Guide to Marketing Your Bar or Restaurant

5. Ignoring Your Liquor Inventory

From counting inventory and ordering alcohol to calculating your pour cost, understanding correct inventory practices is crucial to running a successful bar. As a bar manager, if you don’t develop and uphold solid processes for each stage of the inventory process, your numbers are going to suffer.

These are the most crucial elements to inventory management. If you’re not on top of them, your bar is in trouble:

• Accurate and efficient usage counts
• Fast ordering and organized invoicing
• Setting accurate pars
• Monitoring pour costs
• Calculating and lowering variance
• Minimizing sitting inventory levels
• Identifying top and bottom-performing products
• Using your POS to monitor sales and profitability numbers

If you don’t control these aspects of the inventory process, your variance could grow out of control, you’ll be 86-ing more often, and your sales and profitability could take a huge dive. Teach your staff how to correctly monitor liquor and pour drinks. Organize your invoice history. Use your POS system to compare sales numbers to inventory counts. It’s not the most enjoyable aspect of bar management, but liquor inventory could very well be the most important.

Here at BevSpot, we’ve developed inventory software that’ll take care of this for you and fix your bar management mistakes.

We also have bar management resources that’ll get you on the right track, like free eBooks, case studies and, of course, our famous drink price calculator.

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